One of the key attributes that IML looks for when we invest in stocks is to focus on companies that have a sustainable competitive advantage. In our view a strong competitive advantage is a key reason why some businesses can outperform others over the longer term. At its core, a strong competitive advantage allows a company to earn higher returns than a company that operates in a commodity type business or in an industry with lots of competitors making similar goods.

So how can one identify companies with strong competitive advantage?