I chanced upon an interesting article by another blogger. In it he talks about business moats (read here). His definition of true business moat is:

1. Brands (eg. Colgate, Swatch & Kao)
2. Scale
3. Eco-system
4. Switching cost
5. Distribution

(eg. Facebook, Alibaba, Honda & Johnnie Walker/Diageo for item 3, 4 and 5) The definition of moat by Morningstar is here.

• Low-Cost Producer or Economies of Scale (eg. Wal-Mart)
• High Switching Costs (eg. Autodesk)
• The Network Effect (eg. eBay)
• Intangible Assets: intellectual property rights (patents, trademarks, and copyrights), government approvals, brand names, a unique company culture, or a geographic advantage. (eg. Harley-Davidson)

To me the definition of a business moat is one critical feature which distinguishes a value+growth investor from a pure value investor. Instead of purely looking at the intrinsic value, margin of safety, low price to book ratios, earnings, and being a contrarian, etc (financial fundamentals) of the company as in the case of value investing, by thinking about ......