All highly profitable firms attract competitors, and only firms that are able to keep competition at bay will earn above-average profits for an extended period of time. An economic moat - or competitive advantage - allows a company to fend off competitors and earn sustainable excess economic profits.

In The Little Book That Builds Wealth, Pat Dorsey, the head of Morningstar's equity research team, outlines an effective approach to investing that includes economic moats and tells you how to apply this strategy to your own investment endeavors.

Divided into six comprehensive parts, this reliable resource guides you step by step down the path to understanding and discovering what an economic moat is, how to measure it against other moats, and how to best select a company using this method. While the moat concept is not a new one - it was made famous by Benjamin Graham and Warren Buffett - Dorsey discusses how the modern-day investor can use this strategy to select companies that possess a wide moat and feature good growth fundamentals as well as an attractive stock price.

With this audiobook as your guide, you will discover why moats should be an integral part of your analytical investment toolkit and learn how to leverage this approach to build a portfolio of high-performance stocks.

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Page 1 of 1Start OverPage 1 of 1

Listening Length	4 hours and 54 minutes
Author	Pat Dorsey
Narrator	Steve Blane
Whispersync for Voice	Ready
Audible.com Release Date	July 23, 2008
Publisher	Gildan Media, LLC
Program Type	Audiobook
Version	Unabridged
Language	English
ASIN	B001D48VKI
Best Sellers Rank	#63,375 in Audible Books & Originals (See Top 100 in Audible Books & Originals) #568 in Investing & Trading #750 in Personal Finance (Audible Books & Originals) #1,076 in Introduction to Investing

Customer reviews

5 star		71%
4 star		16%
3 star		8%
2 star		2%
1 star		3%

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Top reviews from the United States

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Nate M.

great introduction to the economic moat concept

Reviewed in the United States on July 18, 2017

Verified Purchase

Great introduction to the determining the valuation of a company. I hadn't read anything with Morningstar before so the "moat" concept was foreign to me going into this book. However it was very easy to read, and we picked pick up the concept pretty quickly.

3 people found this helpful

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Jusuf Hariman

The Knockout Formula for Finding Great Investments

Reviewed in the United States on February 5, 2009

Verified Purchase

If Michael Porter's "Competitive Advantage" can be seen as the first book that conclusively illustrates "managerial" competitive advantage, Pat Dorsey's "The Little Book That Builds Wealth" can be seen as the first book that conclusively illustrates "investing" competitive advantage (I do not regard Warren Buffett's annual reports as a book). Many people invest by reacting, "My brother-in-law recommended it" or "I read about it in Money". It's also easy to get distracted by daily price gyrations and pundits who pontificate about short term market swings. Far better to have a conceptual anchor to help you evaluate stocks and build a rational portfolio. That's when investing competitive advantage, what Warren Buffett calls economic moats are invaluable. This book primarily deals with businesses that can generate above-average profit for many years, despite intense and constant competitive threats. Return on capital is the best benchmark of a company's profitability. It measures how effectively a company uses all of its assets - people, factories, investments - to make money for shareholders. Companies with strong competitive advantage can regularly post return on capital at 20+ percent, which is a rate of return very few money managers can achieve over long periods of time. This book provides a sensible framework for identifying companies that can sustain high return on capital. It tells the reader how to look for durable competitive advantage in choosing equities. The 4 sources of competitive advantage are: (1). Intangible assets; (2). Switching costs; (3). Network effects and (4). Cost advantage. These 4 sources of competitive advantage are elaborated throughout the book. Digest this book and you will develop a solid foundation for making smart investing decisions.

10 people found this helpful

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vatreehugger

so if you're already familiar with them and their principles reading it might be a waste of time

Reviewed in the United States on May 17, 2018

Verified Purchase

It's essentially a big advertisement for Morningstar, so if you're already familiar with them and their principles reading it might be a waste of time. Still, the concepts are intriguing and should help broaden your perspective of the business world.

One person found this helpful

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Deepak

This book is gold, read it to get rid of false notions

Reviewed in the United States on February 17, 2017

Verified Purchase

If you want to understand moats in good detail and common false investing theories/investing, THIS IS IT.

Another great thing he dispels with respect to common investing theory is the importance of management. Even an idiot in a good business can generate cash but God himself as Chairman and CEO can't if he's in a fundamentally horrible business.

2 people found this helpful

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Jose Antonio La Rosa

Highly valuable read about MOATs!!!

Reviewed in the United States on January 1, 2021

Verified Purchase

The best summary about Mosts!!!
Will definitely influence my investment strategy.
Easy to read and full of good examples!!!

Thank you very much!!!

Helpful

Joel Warren McCann

Great Book on Concepts of Sound Investing

Reviewed in the United States on November 17, 2018

Verified Purchase

This book gives you an excellent framework to choose not only how to invest in companies, but choosing stable companies to work for. Very good.

Helpful

Pelagia Nova

Productivity

Reviewed in the United States on February 8, 2020

Verified Purchase

Good source of finance information

Helpful

Kengsan Wong

Easy to read, understand.

Reviewed in the United States on September 22, 2019

Verified Purchase

Author has condensed the complicated steps into a few chapters. It’s Recommended for a re-read and practice. It’s more like a practical book for different level of investors to walk out of the running maze of the investment world.

Helpful

Top reviews from other countries

Avid Reader

Essential reading for a Buffett wannabe

Reviewed in the United Kingdom on December 18, 2016

Verified Purchase

I like the "Little Book" series, the books are content-heavy and fluff-light. This one gives us an excellent description of Warren Buffett's concept of a "moat" around a business, which gives it a solid defence mechanism against competitors. In turn, this gives it a competitive advantage. And if we're going to invest in companies for the long term, knowing this is going to give us an advantage too.

Good companion books for investing like Warren Buffett are:

Invest Like Warren Buffett: Powerful Strategies for Building Wealth
Invest With The House: Hacking The Top Hedge Funds

2 people found this helpful

AJS101

Good overview

Reviewed in the United Kingdom on March 18, 2015

Verified Purchase

Good introduction to how some companies generate above market returns over long periods of time. However, having read the book, I'm not sure if I learnt enough to look at a company and determine how strong it's moat is or how long it will last.

2 people found this helpful

Mr J P Penna

Good book, part of a collection of books by great authors

Reviewed in the United Kingdom on September 17, 2017

Verified Purchase

Not a bad book, part of a collection of others that Im reading. On its own only tells part of the story , need to read books by other authors

One person found this helpful

Common sense

simple yet powerful

Reviewed in the United Kingdom on March 29, 2014

Verified Purchase

A nice presentation of some well known ideas. But a nice reminder of what is important and what is not.

One person found this helpful

Graham

Five Stars

Reviewed in the United Kingdom on April 21, 2015

Verified Purchase

Fantastic book!

One person found this helpful

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