🏔️ What is a good company?

A quality investor that I have a lot of respect for recently remarked to me that "

I think we can all identify quality companies... My concerns are more towards valuations."

It's a curious point, that got me thinking: "Are quality investors just value investors that are waiting for good companies to trade at sensible prices?"

I gracefully disagreed and said that "I'm not sure everyone can identify quality companies. I think a lot of people have invested in something they believed to be quality, but failed to factor in risks that eventually arose."

Let's look at the MSCI World Quality index. It tracks the top 20% of high quality companies. However, it invests in utilities, energy and consumer discretionary companies. These are sectors that many quality investors would stay clear of.

So what is a good company?