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Chart of the Day: Stock Moats

Crews Bank & Trust Wealth Management Services Jan 14, 2025
Chart is a grid that shows examples of the types of moats with examples and explanations in each grid.

Contents

Today’s Chart of the Day is from Brian Feroldi and talks about the Five Types of Moats. We all know about moats around castles for protection. In finance, the concept is similar except it refers to the level of competition for companies. 
 
As an example, let's look at the Apple iPhone. It’s nearly impossible for a new company to create an iPhone from scratch, have all the apps, distribution network, and the reputation of reliability. Versus, at Macy’s where if you don’t like their product or prices, you can simply walk next door, or order on Amazon. 
 
This isn't to say that Macy’s is a bad investment, but for companies like these with no moat, it’s better to own all the retail companies in an index vs. trying to own one or two individually. Then you don’t care which store a customer goes into, just that they go. 
 
Chart of the Day

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Crews Bank & Trust Wealth Management Services
Crews Bank & Trust Wealth Management Services

Experienced professionals from our wealth management services team can help you achieve a bright financial future through investment strategies tailored to you. We’ll show you all of the options available and help you choose the ones best suited to you. We’ll provide high-quality, personal service as we work toward your goals together. Our Portfolio Managers do not receive commissions on trades; our recommendations of investments are based solely on your best interests.

Investments are not a deposit or other obligation of, or guaranteed by, the bank, are not FDIC insured, not insured by any federal government agency, and are subject to investment risks, including possible loss of principal.

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