A moat represents a castle’s first line of defence against intruders. The bigger and deeper it is, the better. An ‘economic moat’ does the same thing for a company – and it’s an absolutely critical feature to look out for before you invest in any stock. An economic moat gives companies staying power. As we’ll discuss in a moment, the moat can come in a wide range of guises – from a brand, to a patent, to regulatory constraints – but in essence, it’s any aspect of the business that allows it to keep making money, and stops other firms [...]
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