ETF Education Report: FIRST TRUST S&P 500 ECONOMIC MOAT ETF (EMOT)

What this ETF is trying to do

The FIRST TRUST S&P 500 ECONOMIC MOAT ETF (ticker: EMOT) is an exchange-traded fund that trades on the NYSE. While the specific strategy isn't detailed in the data, it holds a collection of 51 different companies.

Top Holdings

The following is a partial list of the largest companies held in this ETF. Please note that holdings can change over time:

• HP INC (2.64%)

• FORTINET INC (2.47%)

• MICROSOFT CORP (2.46%)

• METTLER-TOLEDO INTERNATIONAL INC (2.44%)

• AUTOMATIC DATA PROCESSING INC (2.36%)

• META PLATFORMS INC CLASS A (2.36%)

• MASTERCARD INC CLASS A (2.32%)

• PAYCHEX INC (2.30%)

• VISA INC CLASS A (2.29%)

• APPLE INC (2.28%)

What the numbers show

When looking at how an ETF performs, it is important to understand two different types of returns: price return and total return.

• Price Return: This measures only the change in the share price.

• Total Return: This includes both the share price change and any cash distributions (dividends) paid out.

For EMOT, the numbers show:

• Year-to-Date (YTD): The price return is approximately 10.58%, while the total return is approximately 11.37%.

• One-Year: The price return is approximately 10.72%, while the total return is approximately 11.97%.

To visualize the price change, the estimated price from roughly one year ago was $23.77. The current price is $26.32.

Income and distribution explanation

This ETF pays out cash to investors, known as distributions. The distribution yield is currently 1.05%. This number describes the cash payments relative to the current ETF price. The fund usually pays these out quarterly, with 4 payouts recorded over the last 12 months.

It is important to remember that a distribution yield is not the same as total return. While distributions provide cash income, they do not guarantee that your original investment will stay the same value.

NAV erosion explanation

"NAV erosion" refers to a situation where the value of the underlying assets in the fund decreases significantly. StockValueFinder uses an erosion-risk score to measure this risk.

For EMOT, the erosion score is 100, and the label states "No price erosion detected." The erosion severity is rated as "good," and there is no severe erosion-risk flag.

Pros

• The ETF has shown positive price returns and total returns over the last year.

• There is no detected price erosion according to the current erosion-risk measurements.

Cons

• The distribution yield is relatively low at approximately 1.05%.

• Only a partial list of holdings is available, so the full portfolio is not shown here.

Beginner takeaway

When studying EMOT, notice the difference between the price return and the total return. The total return is higher because it accounts for the cash distributions paid to investors. Always look at both numbers to get a full picture of how an ETF has performed.