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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.

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