Capital Markets Spring 2020

I

Competitive Advantage Is Critical Navigating Through a Crisis

I • We believe strong moats or competitive advantages are always important • However, in times of economic weakness, there is often more market share up for grabs, making this attribute of the utmost importance, in our view

II

Performance Based on Degree of Competitive Advantage

III

12.0%

10.5%

Wide moats / strong competitive advantages have outperformed

6.5%

IV

V

No Moat

S&P 500

Wide Moat

VI

Source: Morningstar. 10-year annualized returns for the period ended March 2020. Performance reflects Morningstar indices. Morningstar defines a wide-moat company as having “a sustainable competitive advantage that enables it to keep competitors at bay for an extended period of time.” The performance data quoted represents past performance, which is not an indication or a guarantee of future results.

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