The VanEck Vectors Wide Moat ETF (ASX:MOAT) is one of the two ASX ETFs that are great buys today for international diversification.
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Exchange-traded funds (ETFs) can be useful additions to any ASX portfolio. An ETF doesn’t represent a single ASX share, but rather a collection of different shares, all in one fund.
As such, ETFs can be a useful tool to increase diversification and exposure to hard-to-reach areas in one’s portfolio. To that end, let’s take a closer look at two ASX ETFs.
BetaShares Asian Technology Tigers ETF (ASX: ASIA)
Many ASX investors choose to buy US shares directly, which isn’t that hard these days. But Asian markets remain rather difficult for Aussies to directly participate in.
That’s why this ETF from BetaShares can come in handy. Asian Technology Tigers holds within it 50 of the largest technology companies from the Asian region (excluding Japan).
These include some names you might have heard of, such as Samsung Electronics and Tencent Holdings, to some you may not be as learned in, like JD.com and Baidu. This ETF is heavily dominated by Chinese and Hong Kong-listed companies. But it also offers handy exposure to the Taiwanese, South Korean, and Indian markets.
Asian Technology Tigers has been on an absolute tear over the past year, rising an eye-watering 61%. But, this ETF has also lost a bit of steam in recent weeks and is now down around 14% since 15 February.
It charges a management fee of 0.67% and offers a trailing distribution yield of 0.9%.
VanEck Vectors Wide Moat ETF (ASX: MOAT)
Changing lanes to this ETF from VanEck now. The Wide Moat ETF aims to hold a basket of US shares that all have characteristics that indicate the presence of an economic moat. A moat is a concept pioneered by the great Warren Buffett.
It demonstrates that a company has an intrinsic competitive advantage, such as a strong brand, pricing power or switching costs. This theoretically helps to ‘protect’ the business from competitors in the same way a medieval moat protected a castle from invaders.
No surprises then that the Wide Moat ETF holds Buffett’s Berkshire Hathaway Inc (NYSE: BRK.A) (NYSE: BRK.B) among its holdings. Other names you might know in this ETF include Amazon.com Inc (NASDAQ: AMZN), American Express Company (NYSE: AXP), Microsoft Corporation (NASDAQ: MSFT) and McDonald’s Corporation (NYSE: MCD).
The Wide Moat ETF charges a management fee of 0.39% per annum and has a trailing distribution yield of 1.35%. It has also managed to deliver an average return of 17.31% per annum over the past five years.
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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Sebastian Bowen owns shares of American Express, McDonalds, and VanEck Vectors Morningstar Wide Moat ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Amazon, Baidu, Berkshire Hathaway (B shares), JD.com, and Microsoft and recommends the following options: short January 2023 $200 puts on Berkshire Hathaway (B shares), short March 2021 $225 calls on Berkshire Hathaway (B shares), long January 2022 $1920 calls on Amazon, short January 2022 $1940 calls on Amazon, and long January 2023 $200 calls on Berkshire Hathaway (B shares). The Motley Fool Australia owns shares of and has recommended BetaShares Asia Technology Tigers ETF. The Motley Fool Australia has recommended Amazon, Berkshire Hathaway (B shares), JD.com, and VanEck Vectors Morningstar Wide Moat ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.