The Moat Index

Glossary

The words value investors use, defined the way this site actually uses them. Every entry says not just what a term means but how the Moat Index measures it — and, where our measurement differs from common usage, says so plainly.

• 13F filingThe quarterly SEC form on which large investment managers disclose their U.S.-listed equity holdings — the public record behind our Berkshire portfolio page.
• 90-day cluster buyAt least three distinct insiders reported Form 4 code P purchases during the trailing 90-day window; other transaction classes do not qualify.
• Append-only score historyEvery Moat Score reading is stored as a new timestamped row and never edited — corrections are new rows too. The history is the record, not a cache.
• Balance-sheet safetyThe model's reading of whether debt and interest obligations leave a business room to withstand weaker conditions without depending on favorable refinancing.
• Benchmark returnThe change in a named comparison index or security over the same stated window as the result beside it; price return excludes dividends, while total return includes them.
• Book value growthThe change in a financial company's common equity per share across comparable fiscal-year filings, scored only inside the financial-sector model.
• Buffett IndicatorThe market value of publicly traded U.S. corporate equities divided by current-dollar U.S. GDP — an aggregate valuation measure, not a stand-alone market-timing rule.
• Capital allocationHow management deploys the cash a business generates — through reinvestment, acquisitions, debt reduction, dividends, and changes in the share count.
• Capital strengthA bank or insurer's filing-derived capacity to absorb losses while meeting its regulatory and balance-sheet obligations.
• Capped-growth comparisonA per-share owner-earnings comparison that allows growth only up to the model's disclosed cap; it is a scenario, not a price target.
• Circle of competenceBuffett's rule to invest only where you genuinely understand the business — and to know exactly where the edge of your understanding is.
• CohortA group formed using the same stated selection date and rules so its later results can be compared on a consistent basis.
• Coverage gateThe Moat Index's refusal to guess: one missing component is disclosed and renormalized; two or more mean “insufficient data” instead of a number.
• Earnings stabilityThe consistency of a financial company's comparable reported earnings across the model's stated fiscal-year window.
• Economic moatA durable competitive advantage that protects a company's profits from competitors, the way a moat protects a castle — the central idea the Moat Index measures from SEC filings.
• Financial-sector modelOperating companies use the Moat Score. Covered banks and insurers are scored under a separate financial-sector model with its own components and calibration; financial-sector scores are never ranked, averaged, or described as comparable with the operating Moat Score.
• Form 4 transaction classThe exact SEC transaction code reported by an insider; purchases, sales, awards, withholding, gifts, and exercises remain distinct rather than being collapsed into buying or selling.
• Forward returnThe investment return measured after a stated point-in-time selection date over the labeled 1-, 3-, or 5-year window.
• Fund constitutionThe timestamped, append-only record that fixes a paper portfolio's members, weights, rules, and methodology version before performance is measured.
• Gross, operating & net marginThree cuts of profitability: what's left of revenue after production costs (gross), after running the business (operating), and after everything including interest and tax (net).
• Intrinsic valueWhat a business is actually worth — the value of the cash an owner could take out of it over its remaining life — as opposed to whatever the market quotes today.
• Manager convictionA reported holding's value divided by that manager's eligible common-share 13F denominator for the same quarter; it is delayed disclosure, not a statement of intent.
• Margin of safetyThe gap between what you pay and what the business is conservatively worth — Benjamin Graham's cushion against your own analytical mistakes.
• Market cap to GDPAn aggregate ratio comparing the market value of public companies with a country's annual economic output; useful context whose numerator and denominator do not cover identical activity.
• Market capitalizationThe market value of a company's listed equity: recent share price multiplied by shares outstanding on the available basis.
• Moat ScoreThis site's 0–100 business-durability reading, computed from primary SEC filings as five equally weighted sub-scores.
• Moat-versus-price quadrantA labeled region formed by Moat Score and price versus value if growth stopped today; position describes those two readings and is not a recommendation.
• Mr. MarketBenjamin Graham's allegory for the stock market: a moody business partner who quotes you a different price every day — and whose quotes are options, never orders.
• Net interest incomeA bank's interest revenue minus its interest expense, evaluated across comparable filings inside the bank model.
• Net P/S buyingThe disclosed value of Form 4 code P purchases minus code S sales over the trailing 12-month window; awards and compensation mechanics are excluded.
• New reported buyA position first reported by a tracked manager in the current comparable 13F quarter; it does not reveal the trade date or prove the manager still owns it today.
• Owner earningsThe cash a business actually generates for its owners: net income plus depreciation and amortization, minus the capital spending needed just to keep the business running.
• Point-in-time scoreA Moat Score reconstructed using only filings available by the stated selection date, with no later information allowed into the reading.
• Portfolio weightA holding's reported value divided by the eligible reported portfolio value for the same timestamped disclosure or constitution.
• Position valueThe market value reported for a holding in the cited quarter-end filing, kept separate from its percentage weight in the portfolio.
• Pricing powerA business's demonstrated ability to preserve gross and operating economics across the trailing fiscal-year window, rather than a claim based on brand reputation.
• Quarterly share changeThe change in shares reported between comparable 13F quarter-end snapshots; 'new' means first reported, not necessarily newly purchased that day.
• Recent priceThe latest verified market price available to the model, shown with its actual observation basis rather than treated as a live quote.
• ReconstitutionA scheduled, timestamped replacement of a rules-based portfolio's constitution under the published eligibility and ranking rules.
• Reported holding sharesThe number of shares a manager reported holding at the cited 13F quarter end; it is a position quantity, not the issuer's total shares outstanding.
• Return on equityA financial company's earnings divided by common shareholders' equity on the model's comparable filing basis.
• RevenueThe company's top-line sales reported for the stated fiscal year, shown as filed and never filled across a missing period.
• Revenue and EPS trendThe direction and consistency of reported revenue and earnings per share across up to the ten most recent comparable fiscal years.
• ROIC (return on invested capital)After-tax operating profit divided by the capital tied up in the business — the single best measure of whether a company creates value with the money it employs.
• Rule DThe published paper-portfolio rule that equal-weights the 50 widest eligible Moat Score companies and reconstitutes them on its stated annual schedule.
• Shares outstandingThe issuer's reported share count on the cited date; percentage-of-company calculations are withheld when a reviewed denominator is unavailable.
• Since-inception returnThe cumulative total return from the portfolio's stated inception close through the latest verified valuation mark, with dividends included where the label says total return.
• Total debtThe company's reported interest-bearing borrowings for the stated fiscal year, shown as filed rather than estimated across missing periods.
• Tracked holdersThe count of managers on the approved research roster that reported an eligible current-quarter position; missing or stale comparisons remain explicit.
• Transaction priceThe per-share price disclosed on the cited Form 4 transaction; an undisclosed price remains unavailable rather than becoming zero.
• Transaction sharesThe number of shares reported for the cited Form 4 transaction, kept separate from the insider's post-transaction ownership.
• Transaction valueReported transaction shares multiplied by the disclosed per-share price; unavailable inputs keep the value unavailable.
• Underwriting disciplineAn insurer's filing-derived record of pricing risk well enough that claims and expenses remain controlled across comparable periods.
• Valuation markA timestamped paper-portfolio valuation using the verified prices available for its members; missing prices remain missing rather than becoming zero.
• Value if growth stopped todayNormalized owner earnings capitalized at the disclosed zero-growth multiple, assuming zero growth forever. Compare the per-share result with the current share price to see what you are paying for future growth. It is a model baseline, not a price target.
• Wide, narrow & shallow moatsThe Moat Index's tier labels for moat durability — Wide (score 80–100), Narrow (60–79), Shallow (40–59), and no moat below 40. Exact score bands, not analyst judgments.

Definitions are educational, not investment advice. The formulas behind every measured term live in the methodology; the limits live there too. See the disclaimer.