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Investing Specialists

New Stocks in the Morningstar Wide Moat Focus Index

We've added to the roster of attractively priced, competitively advantaged companies.

Mentioned: , , , , , , , , ,

Those who are familiar with the Morningstar Wide Moat Focus Index know it as a 20-stock index that provides exposure to the most undervalued, highest-quality companies in our coverage universe. Those are the only two qualifications for inclusion: Companies must have an economic moat rating of wide (meaning we think they have advantages that will fend off competitors for at least 20 years), and their shares must be trading below their fair value estimates, which are determined through independent research conducted by the Morningstar Equity Research team.

The index, which launched in October 2007, was rebalanced quarterly so that each holding started the quarter with an equal 5% weighting. Over the past 10-year period, this index has returned 11.4% per year, including dividends, versus a 7.4% annual total return for the S&P 500. Over shorter periods, results are also impressive: The index has outperformed the S&P 500 by more than 160 basis points over five years, and 50 basis points over three years.

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