From Morningstar: 2025-05-27 11:28:00

Morningstar has developed an economic moat rating system to evaluate a company’s competitive advantage and market position sustainability. Five sources of competitive advantage are identified: intangible assets, switching costs, network effects, cost advantages, and economies of scale. Ratings can range from no moat to wide moat.

Combining the moat rating with the Morningstar Medalist Rating for Funds, which evaluates fund quality on a Gold to Negative scale, offers insight into potential performance over a market cycle. Gold-rated funds show a higher percentage of wide moat companies in their portfolios than negatively rated funds.

Of the 63 large-cap European equity funds with Gold Medalist Ratings and assets over EUR 100 million, 10 stand out for holding the highest percentage of companies with a wide competitive advantage. These funds include Comgest Growth Europe, iShares Europe Equity Index Fund, and Vanguard ESG Developed Europe Index Fund, among others.



Read more at Morningstar: The Best European Funds That Invest in Wide-Moat Stocks