Most “luxury” oriented ETFs include a wide universe of companies that many would not regard as luxury. Though what brands comprise luxury versus premium and so forth is not set in stone, many ETFs include firms such as Tesla and Nike which probably would not fit most definitions. These can be quite distorting, particularly given that many ETFs are cap weighted and Tesla’s $660+ billion valuation dwarfs true luxury firms with LVMH being closest at just over $360 billion.
We constructed a narrower, cap weighted, index of what we regarded as the top 15 pure luxury play stocks. The below shows how this index has performed against the S&P 500 since the start of the year. The trajectory of these wealth paths will not surprise many so far (your $100 investment in luxury would be sitting at $93.81 while an S&P 100 index tracker would put you at $102.28) but this will be something to watch as the luxury earnings come in over the next week or so.
To keep on your radar: LVMH will release its next earnings report on January 25 and Dior will follow on January 29.