Are you ready for the next fat pitch that the stock market might throw your way? Preparedness is the key to taking advantage of great opportunities.
In the past, I struggled to take advantage of unexpected downturns in the stock market. In the emotional chaos that often hits after a market plunge, I often was unable to research enough companies fast enough to make a quality purchase decision while prices remained low.
My goal is to identify the highest quality companies now, so that I can swing hard and sure at the next fat pitch that comes over my plate. I am particularly looking for companies with sustainable competitive advantages and will keep them ahead of their competition for years to come. Warren Buffett refers to these companies as having wide moats.
What gives a company a wide moat that keeps the competition at bay? Some companies are very low cost producers, others have key patents on their products, and still others provide services that have high switching costs.
I’ll go into these characteristics in further detail in the examples I discuss in upcoming articles. Feel free to suggest your favorite wide moat companies and I’ll take a close look at them here.