What is a monopoly and why do investors love it?
When we were kids, Monopoly was a board game – whoever conquered all the stations, hotels, and streets ruled the board.
But in the real world?
A monopoly is not a game – it's an investor's wet dream.
So what exactly is a monopoly?
A company that solely controls a specific market – without real competition, without rivals eating into its profits, and without pressure to lower prices.
This can be due to a strong patent, strict regulation, an unbeatable brand, or simply a technological advantage that blocks others from entering.
Why do investors love monopolies?
Because it means: consistently high profits, almost unlimited pricing power, relative security against competition, high predictability of cash flow.
Think about it for a moment – who would dare to start a search company that would "beat Google"?
Or a social network that would beat Facebook *and* generate profit?
In simple terms, a monopoly is the lion of the business jungle.
So here are some real-world examples every investor should know:
$GOOGL – a monopoly in web search, and also the owner of YouTube – the world's largest streaming site (no, not Netflix).
$META – a monopoly in social networks with Facebook, Instagram, and WhatsApp.
$NVDA – dominates the graphics chip sector, the foundation of the AI world.
$ASML – the only company in the world that produces the machines required for advanced chip manufacturing.
$TSMC – the exclusive leader in producing the highest-level chips in the world.
$CLBT – a monopoly in digital forensic decoding (and let's just say everyone uses its services, including the FBI, CIA, and Israeli security agencies).
$AXON – dominates the field of equipment for police officers, from tasers to body cameras.
$ADBE – the queen of digital editing.
If you've ever worked with Photoshop or Premiere, you already know.
$PLTR – a monopoly in commercializing artificial intelligence for businesses and governments, with a rare depth of data.
When a company is a true monopoly, it becomes a lion in the business jungle.