Investing in businesses with moats

Hi Sir/Madam,

Straight into it.

How do you indentify a business with a moat?

What makes a moat?

Why are businesses with moats a superior investments?

A moat is something which allows the business to stand out and to be a company which has a competitive advantage, allowing it to almost dominate or be a company which can handle competitive environments- which are common within business. The ability to be able to differentiate in the market by having features which allow the company to perform well.

A few examples:

  • A great customer service/experience
  • A strong brand
  • A product which is a must or of high value to consumers

These are a few examples, these features make a stock a better investment over the long run- simply because the business is able to likely be a long lasting business and this allows the business to grow and outshine it’s competitors in the long run.

To identify a moat, you simply have to find out which business has a strong competitive advantage within the market and this can be done through research, industry knowledge and your own understanding of a business. Finding businesses with long lasting moats allows you to be able to secure your money and likely attain strong investment returns.

What makes a moat important?

The simple fact that a moat is the key factor in allowing the business to thrive within tough markets and to be a long lasting business, this makes for a great investment.

Businesses with moats are superior investments as they promise adequate returns over time and allow for your money to be in an investment where the chances of losing money over the long term are greatly reduced. In investing the rules are simple, buy an investment which will massively reduce your chances of losing money- in addition to increasing your chances at attaining above average results in the long term.

In investing: the rules are simple if you are wanting to achieve great results.

Rule#1:

Do not lose money.

Rule#2:

Don’t forget rule#1.

That’s just it and is everything which you need to know in order for you to attain above average results, a moat increases your chances of being a part of these 2 rules.

Thank you for reading,

Have a fantastic day.

Regards,

Jagdip

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