Table of Contents
How do you identify a moat?
Top 5 Ways to Recognize an Effective Economic Moat
- The Advantage of Lower Cost.
- The Advantage of Greater Size.
- The Possession of Unique Assets.
- The Benefits of the Network Effect.
- The Ability to Command High Switching Costs.
What does it mean when a company has a moat?
Moat investing is based on a simple concept: Invest in companies with sustainable competitive advantages trading at attractive valuations. A company’s moat refers to its ability to maintain the competitive advantages that are expected to help it fend off competition and maintain profitability into the future.
What does moat rating mean?
A moat rating is an analysis of a company’s economic moat — How effective it is at a given moment, and for how long the moat will remain effective. A moat can be “wide,” meaning it’s expected to last for at least the next twenty years, or “narrow,” meaning it could last for about a decade.
What does a wide moat mean in stocks?
sustainable competitive advantage
A wide economic moat is a type of sustainable competitive advantage possessed by a business that makes it difficult for rivals to wear down its market share. The wider the moat, the more difficult it would be for an invader to reach the castle.
What does no moat mean?
no sustainable competitive advantage
Morningstar divides stocks into three categories according to moat size: wide moat (companies with the strongest competitive advantage) narrow moat (those with some competitive advantage) no moat (those with no sustainable competitive advantage)
What is a wide moat ETF?
Wide Moat ETFs invest in a wide variety of stocks that have the potential to outperform over the long term. Click on the tabs below to see more information on Wide Moat ETFs, including historical performance, dividends, holdings, expense ratios, technical indicators, analysts reports and more.
What is a no moat stock?
Morningstar divides stocks into three categories according to moat size: wide moat (companies with the strongest competitive advantage) narrow moat (those with some competitive advantage) no moat (those with no sustainable competitive advantage)