Two Alternative ASX ETFs to Balance Your Portfolio: MOAT and VEQ

The article discusses the iShares S&P 500 ETF (IVV) and suggests alternative ASX ETFs to diversify portfolios. The VanEck Morningstar Wide Moat ETF (MOAT) is recommended for maintaining US share exposure, with a portfolio of high-quality, attractively priced US shares. The Vanguard FTSE Europe Shares ETF (VEQ) is suggested for geographic diversification, featuring over 1,200 European businesses across various sectors.

Australian investors seeking to diversify their portfolios can benefit from a range of Exchange-Traded Funds (ETFs) that provide international exposure. The iShares S&P 500 ETF (IVV) remains a popular choice for US market exposure, but there are alternative ASX ETFs that can enhance geographic diversification.

iShares S&P 500 ETF (IVV)

The iShares S&P 500 ETF (ASX: IVV) offers broad exposure to the United States market by tracking the S&P 500 Index. This ETF provides access to a diversified mix of sectors, including technology, healthcare, consumer goods, and financials. Notable holdings include tech giants such as Apple (NASDAQ: AAPL), Microsoft (NASDAQ: MSFT), and Nvidia (NASDAQ: NVDA), as well as global leaders like Johnson & Johnson (NYSE: JNJ), Procter & Gamble (NYSE: PG), and JPMorgan Chase (NYSE: JPM). Given the resilience of the U.S. economy and the innovation power of its corporate sector, IVV serves as a foundational building block for internationally diversified portfolios.

Alternative ASX ETFs for Diversification

For investors looking to broaden their geographic diversification, the VanEck Morningstar Wide Moat ETF (MOAT) and the Vanguard FTSE Europe Shares ETF (VEQ) are recommended alternatives.

VanEck Morningstar Wide Moat ETF (MOAT)

The VanEck Morningstar Wide Moat ETF (ASX: MOAT) tracks the Morningstar Wide Moat Focus index, which includes a staggered, equal-weighted portfolio of 40 US companies with sustainable competitive advantages. The fund focuses on companies with high fair values and attractive valuations, providing a unique blend of wide-moat stock selection and value screening. With a total return of 9.16% in the past year and an average annual return of 13.75% since inception, MOAT offers a balanced, diversified portfolio with risk discipline [3].

Vanguard FTSE Europe Shares ETF (VEQ)

The Vanguard FTSE Europe Shares ETF (ASX: VEQ) provides exposure to over 1,200 European businesses across various sectors. This ETF tracks the FTSE Europe Index and offers a simple, all-in-one option for those seeking true geographic diversification. With global economic growth expected to pick up in the years ahead, VEQ offers investors access to businesses that are leaders in their respective regions and industries [1].

Conclusion

Both the iShares S&P 500 ETF (IVV) and the alternative ASX ETFs, VanEck Morningstar Wide Moat ETF (MOAT) and Vanguard FTSE Europe Shares ETF (VEQ), offer low-cost, easy access to international markets. By investing in these ETFs, Australian investors can gain exposure to a broad range of well-known international companies without the need for extensive market knowledge or an international brokerage account. These ETFs provide a solid foundation for diversifying portfolios and mitigating risks associated with market volatility.

References

[1] https://www.ainvest.com/news/top-asx-etfs-global-portfolio-diversification-fy-2026-2507/
[2] https://www.etf.com/sections/weekly-etf-flows/VOO-etf-investors-add-241b
[3] https://stockanalysis.com/etf/moat/