Should You Invest in the VanEck Agribusiness ETF (MOO)?

If you're interested in broad exposure to the Materials - Agribusiness segment of the equity market, look no further than the VanEck Agribusiness ETF (MOO), a passively managed exchange traded fund launched on 08/31/2007.

Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.

Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Materials - Agribusiness is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 13, placing it in bottom 19%.

Index Details

The fund is sponsored by Van Eck. It has amassed assets over $1.11 billion, making it one of the larger ETFs attempting to match the performance of the Materials - Agribusiness segment of the equity market. MOO seeks to match the performance of the MVIS Global Agribusiness Index before fees and expenses.

The MVIS Global Agribusiness Index tracks the overall performance of companies involved in agri-chemicals, animal health and fertilizers, seeds and traits; farm/irrigation equipment and farm machinery; agricultural products, aquaculture and fishing, livestock plantations, and trading of agricultural products.

Costs

Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.

Annual operating expenses for this ETF are 0.53%, making it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 2.24%.

Sector Exposure and Top Holdings

ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.

Looking at individual holdings, Deere & Co (DE) accounts for about 8.59% of total assets, followed by Zoetis Inc (ZTS) and Nutrien Ltd (NTR).

The top 10 holdings account for about 57.63% of total assets under management.

Performance and Risk

The ETF has lost about -4% so far this year and is down about -5.98% in the last one year (as of 06/22/2023). In that past 52-week period, it has traded between $77.15 and $95.87.

The ETF has a beta of 0.93 and standard deviation of 18.37% for the trailing three-year period, making it a low risk choice in the space. With about 54 holdings, it effectively diversifies company-specific risk.

Alternatives

VanEck Agribusiness ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, MOO is a good option for those seeking exposure to the Materials ETFs area of the market. Investors might also want to consider some other ETF options in the space.

IShares MSCI Agriculture Producers ETF (VEGI) tracks MSCI ACWI Select Agriculture Producers Investable Market Index. The fund has $231.84 million in assets. VEGI has an expense ratio of 0.39%.

Bottom Line

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

Want key ETF info delivered straight to your inbox?

Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.

Get it free >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

VanEck Agribusiness ETF (MOO): ETF Research Reports

Deere & Company (DE) : Free Stock Analysis Report

Zoetis Inc. (ZTS) : Free Stock Analysis Report

iShares MSCI Agriculture Producers ETF (VEGI): ETF Research Reports

Nutrien Ltd. (NTR) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Tags

More Related Articles

Info icon

This data feed is not available at this time.

Sign up for Smart Investing to get the latest news, strategies and tips to help you invest smarter.