QUAL vs MOAT: Quality Factor vs Wide-Moat Investing, Two Smart Beta Approaches
QUAL filters for financial quality at low cost. MOAT filters for competitive advantage and value at a higher price. Both aim to beat the market through disciplined stock selection, using different frameworks.
QUAL (iShares MSCI USA Quality Factor ETF) and MOAT (VanEck Morningstar Wide Moat ETF) both aim to deliver market-beating returns through systematic stock selection, but using very different methodologies. QUAL selects ~125 US large-cap stocks scoring high on return on equity, earnings stability, and low debt ratios, essentially financially healthy companies. MOAT selects 40-50 stocks that Morningstar analysts rate as having "wide moats" (durable competitive advantages) AND trading at a discount to fair value, combining quality with a value discipline. QUAL costs 0.15%; MOAT costs 0.47%. QUAL has outperformed significantly recently due to its tech mega-cap exposure. MOAT's value overlay has sometimes caused it to underweight the most expensive tech names. For investors who want quality exposure at lower cost, QUAL is better. For investors who want Morningstar's conviction picks with a value margin of safety, MOAT is distinctive.
Whether the lower-cost fund suits your situation depends on your existing holdings, account type, tax situation, and how you use each fund. This is a cost comparison, not a personalized recommendation.
📋 QUAL vs MOAT — Key Facts Side by Side
| Metric | QUAL | MOAT |
|---|---|---|
| Fund Name | iShares MSCI USA Quality Factor ETF | VanEck Morningstar Wide Moat ETF |
| Issuer | iShares | VanEck |
| Tracks Index | MSCI USA Sector Neutral Quality | Morningstar Wide Moat Focus |
| Expense Ratio | 0.15% ✓ | 0.47% |
| Cost per $10K/yr | $15.00 | $47.00 |
| AUM | $45.9B | $11.6B |
| Holdings | 125 | 50 |
| Inception | 2013 | 2012 |
| 1-Year Return | +19.46% | +10.57% |
| 3-Year Return | +19.29% | +11.72% |
| 5-Year Return | +11.38% | +8.36% |
| Dividend Yield | 0.86% | 1.35% |
| Holdings Overlap | See holdings overlap → | |
| Avg Bid-Ask Spread | 0.01% | 0.02% |
Expense ratio, AUM, and returns updated Jul 14, 2026 from ETF BFF database. Returns are annualised. Not investment advice.
📊 QUAL vs MOAT — Annualised Returns
Annualised returns (trailing, price-based). Past performance does not guarantee future results.
🎯 Which Fund Fits Which Investor?
- want the lowest fees: saves ~$32/yr per $10K vs MOAT
- want broader diversification (125 holdings vs 50)
- already use VanEck and prefer staying within one fund family
💰 What the Fee Difference Actually Costs
Adjust the numbers for your situation. This models each fund's expense ratio compounding against your balance over time.
Assumes a constant annual return reinvested, with each fund's expense ratio deducted yearly. Illustrative only; actual returns vary. Past performance does not guarantee future results.
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❓ QUAL vs MOAT — Frequently Asked Questions
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