VanEck Morningstar SMID Moat ETF (SMOT US) – Portfolio Construction Methodology

The underlying Morningstar US Small-Mid Cap Moat Focus Index targets U.S. equities from the Morningstar US Small-Mid Cap universe (roughly the 70%–97% float-adjusted market-cap band) that carry Morningstar Economic Moat ratings of Wide or Narrow and trade at the largest discounts to analyst fair value. The index uses a staggered two-sub-portfolio design: each sub-portfolio holds 75 equal-weighted names, reconstituted and reset semi-annually on alternating quarters (March/September and June/December), yielding a quarterly refresh with buffers to favor incumbents when price/fair-value rankings are near the cutoff. Eligibility, liquidity, and investability screens flow from the parent universe; weights float between resets. If a constituent loses its eligible moat rating or exits the parent size universe at a review, it is replaced at that sub-portfolio’s next reset by the next-ranked discounted eligible name.

To explore SMOT in more depth, visit our ETF analytics platform for institutional-grade insights — including performance and risk metrics, correlations, sensitivities, and factor exposure: https://www.etfstrategy.com/etf/SMOT_US