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ETF Specialist

Eight Cheap ETFs Loaded with Wide-Moat Stocks

These high-quality portfolios are trading at bargain prices.

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A key prong in our equity analysis method is the concept of economic moat. The term, which was originally coined by Warren Buffett, refers to a firm's competitive positioning. A company with an economic moat has a durable advantage that helps it keep competitors at bay and thereby generate outsized returns for shareholders.

For a firm to earn a wide-moat rating, our analyst must believe that the company's competitive advantage is sustainable over the long haul. Thanks to its enduring competitive edge, a wide-moat firm is likely to generate returns in excess of its cost of capital for several years into the future. Accordingly, a wide-moat company is far more likely than a no-moat firm to create value for the business and for its shareholders.

Sonya Morris does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.