You would think it would be hard to make money investing in large, stable, mature businesses like Johnson & Johnson or Coca-Cola. After all, the conventional investment wisdom tells us that the more investors follow a stock, the more likely it is to be fairly priced. And the more efficiently priced a stock is, the harder it is to make money owning that stock, since the price reflects all available information.

Yet, despite the hoards of Wall Street traders and investment funds holding stock in these blue-chip monoliths, prices of many such stocks have surged higher at seemingly inexplicable rates. International Business Machines is up 15% over the last year. Oracle is up 36%. For Pete's sake, Apple, now the third-largest publicly traded company in the world -- is up 68% in the last year.

Figuring out which well-known giant is actually an underappreciated gem is all about asking the right questions.

1. Is the business mature everywhere?
Let's go back to Coca-Cola (NYSE: KO) for a minute. It would be hard to argue that the business is not mature in North America. After all, sales of the original Coca-Cola beverage have come a long way since the fledgling company averaged nine beverage sales a day in its first year in 1886. But when we bought shares of Coke for Million Dollar Portfolio back in May, we weren't looking at the company's domestic operations. In fact, the idea was brought up by Tim Hanson, our international stock guru, who argued that Coke has plenty of fizz left in developing countries.

Coke's third-quarter earnings report gave us an updated look into the business -- and sure enough, the company is bubbling over in developing markets. Compared to healthy but standard 2% growth in North America, volume was up 12% in both Africa and China, 13% in Brazil, and a whopping 34% in Russia.

In less than six months, Million Dollar Portfolio's stake is up 16% -- on Coca-Cola! We're talking the world's most valuable brand here, a bargain hiding in plain sight for those who asked the right questions.

2. What don't I know?
Some businesses you will never know as well as you'd like. The meltdown of several major banks in the recent financial crisis was a wakeup call to investors, reminding them of the difficulty of fully understanding the black boxes that are Wall Street banks. No matter how deep investors in bank holding company Citigroup (NYSE: C) or insurer American International Group (NYSE: AIG) dug, they couldn't possibly have understood exactly the risks that were being taken. The same probably holds true today. Heck, the CEOs didn't even entirely know.

When faced with the unknowable, don't even try. At Million Dollar Portfolio, after studying the merits of for-profit educator Apollo Group (Nasdaq: APOL) for months, we decided it didn't make the grade. Though the University of Phoenix (Apollo's prize business) generates backpack-loads of cash, we couldn't wrap our heads around the company's unsavory student recruiting methods. Throw in regulatory uncertainty in a business that receives almost 90% of its revenue from government grants, and we were just fine letting this could-be opportunity slip away.

As Warren Buffett said, investing is like being a baseball player at bat, but with no called strikes. Why swing if the pitch isn't perfect?

3. How's the moat?
In most industries, the biggest player is not the fastest growing. But that is yet another mold that search-king Google (Nasdaq: GOOG) is breaking right now. Despite owning 66% of the market, Google's search growth continues to outpace that of competitors Yahoo! (Nasdaq: YHOO) and Microsoft's (Nasdaq: MSFT) Bing.

The driver behind the growth is Google's moat, which Charlie Munger has lauded. Google has the best search algorithm because it has the most data. It has the most data because it has the most users. It has the most users because it has the best search algorithm. That's a moat.

We at Million Dollar Portfolio agree with Munger's assessment, so when we thought shares looked cheap back in June, we pounced on them. We're up 39% since then -- on one of the most widely followed companies out there.

Asking the right questions
Great investing is all about asking the right questions. Doing so, of course, is not always easy. But if you can identify a company's prospects in different markets, avoid things you can't know, and understand a business's moat, you'll already fare better than the majority of investors out there.

Thinking about which questions are the right ones to ask is how we attack every investment opportunity at Million Dollar Portfolio. The strategy has worked nicely -- since Motley Fool co-founders Tom and David Gardner entrusted us with $1 million of their cash, we've beaten the market by more than 5%.

If you would like to follow along in real time as we invest and manage that cash -- and have the opportunity to execute our trades even before we do -- our Million Dollar Portfolio is opening to new members for a limited time only. To best serve our members, and to make all members get the most possible out of the service, we take in new members only infrequently. If you are interested in learning more, simply enter your email address in the box below.

Alex Pape is an analyst for Million Dollar Portfolio. He does not own shares of any stock mentioned. Google, Coca-Cola, and Microsoft are Motley Fool Inside Value picks. Google is a Motley Fool Rule Breakers choice. Apple is a Motley Fool Stock Advisor selection. Johnson & Johnson and Coca-Cola are Motley Fool Income Investor selections. Motley Fool Options has recommended a diagonal call position on Johnson & Johnson and Microsoft. The Fool owns shares of Apple, Coca-Cola, Google, International Business Machines, Johnson & Johnson, Microsoft, and Oracle. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.