1 ) "The size of the market in which the company operates should be high and increasing at a good pace"

This will filter out companies in smaller and stagnant industries which have lower probability to generate very high returns.

2) "The company should be a market leader and/or gaining market share from its competitors"

This will filter out smaller and slow growing players in any industry, thus allowing us to focus on high growth companies of an industry.

3) "The company should have a moat or a competitive advantage which is difficult for the competitors to replicate"

A company with strong moat will have a clear growth runway while competitors are only playing a catch-up.

4) "The company should have best operating efficiency or have the best margins in the industry"

This will filter out companies with poor capital allocation and execution.

5) "The company should have pricing power amongst its customers"

The companies with pricing power fare better during economic downturns.

DISCLAIMER: This blog is solely for educational purposes and not to offer any investment advice. Please do your own research or consult a financial advisor before making any investment decisions.