Friday, December 10, 2010

Economic Recovery and Luxury Stocks

It seems that the economic recovery is aiding luxury brand stocks. Just read the news that Tiffany & Co stock price ahas more than tripled to $62.57 since Mar 2009.

During the recession, I remembered clearly that Osim's stock price was really depressed. Now it is above $1.50.

It shows that luxury brand stocks do in some ways benefit from cyclical trends. With consumer spending on the rise, these companies tend to have better sales during an economic recovery.

Another factor is also the increase in consumer spending in Brazil, Russia, India and China which together for a strong consumer base for these luxury goods. In fact, analysts have opined that emerging market shoppers will provide some of the better opportunities of investment in our life time.

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