James Ding
Sep 26, 2025 11:10
The Moat Index has shifted its focus by reducing technology sector exposure and emphasizing value investments, reflecting a contrarian stance in the current market landscape.
The latest review of the Moat Index has resulted in a notable shift in strategy, as the index trims its technology sector exposure while maintaining a strong emphasis on value investments. This move underscores the index’s contrarian position amidst current market trends, according to VanEck.
Strategic Adjustments
In its September review, the Moat Index made strategic adjustments by reducing its holdings in the technology sector and introducing new names to its portfolio, reflecting a deliberate tilt towards value. This approach is designed to capitalize on companies with sustainable competitive advantages, a core tenet of the index’s methodology.
Background and Methodology
The Moat Index, maintained by Morningstar, is known for its unique focus on stocks that are believed to be trading below their intrinsic value. The index’s construction rules, which were updated in 2016, expanded its constituent count and altered its rebalancing methodology to enhance diversification and reduce turnover.
Market Positioning
This latest adjustment comes at a time when the technology sector has experienced substantial growth, leading many investors to question the sustainability of its high valuations. By shifting focus, the Moat Index aims to leverage opportunities in undervalued sectors, aligning with its philosophy of identifying firms with long-term competitive strengths.
Investor Implications
For investors, this adjustment may signal a need to reassess their portfolios, particularly those heavily weighted in technology stocks. The Moat Index’s value-centric approach may offer a more balanced risk profile, especially in volatile market conditions.
For more details, readers can access the full article on the VanEck website.
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Source: https://blockchain.news/news/moat-index-adjusts-strategy-reduces-tech-exposure
