TEXT ONE
When times get tough, people with an abundance of disposable income are inclined to keep disposing of it while the rest of us are forced to keep our thinner wallets in our pockets. With that in mind, Tobias Levkovich, Citigroups chief United States equity strategist, has created the Living Large Index, comprising stocks of businesses that cater to affluent consumers. Profits and share prices of luxury-goods makers, higher-end retailers and travel and entertainment companies should hold up even if businesses serving them suffer from difficult economic conditions, he said.
The index is a new creation, but back-testing shows that building a portfolio from its component stocks would have been a far more lucrative long-term strategy than mimicking the Standard Poors 500-stock index. A $100 investment in Living Large at the end of 1995 would have grown to $1,013 by Oct. 31, compared with $252 for the S. P. No wonder the logic behind the index wins high marks from investment advisers. It certainly makes sense conceptually, said Charles L. Norton, manager of the Vice fund, which invests in companies like tobacco makers, gambling emporiums and purveyors of alcohol. Usually in a recession, people at the lower end of the food chain are hurt most and so those catering to the luxury end tend to be relatively insulated. Mr. Norton holds one index constituent, Wynn, the owner of casinos, including one in Macao that has become a popular destination for Asian gamblers. Asia is expected to be a source of tremendous growth for the gambling industry.
If catering to well-heeled Americans is profitable, doing the same for wealthy people around the globe may be even more so. As economies develop, the number of rich people soars, and they have the same expensive tastes as Americans do. The next big frontier for many of these luxury retailers is emerging countries, where growth is faster and the number of affluent people is growing even faster, said Andrew Peck, manager of the Baron Asset fund. There are opportunities ahead for them in markets like China and India, where many new millionaires are being created every day. He expects Wynn and Tiffany to benefit from those opportunities, along with a retailer not in Mr. Levkovichs index, Polo Ralph Lauren.
John Buckingham, chief investment officer of Al Frank Asset Management, recently recommended Nordstrom and Callaway Golf. He cautioned against depending on them and other Living Large stocks to hold their value if weakness persists in the economy and stock market, however. Much of their sales come from so-called aspirational buyers, those who hope to be affluent one day but are not yet in that category. The already affluent can afford cruises and top-name accessories when times are tough; the would-be affluent cannot. He noted that some of the index companies, notably Coach, Tiffany and Nordstrom, have recently reported earnings lower than analysts estimates, a result of aspirational buyers slowing their purchases.
Mr. Pecks quibble is with the selection of companies from disparate industries to create an index that purports to track a single phenomenon. Their share prices may be driven by myriad factors other than the appeal of their products and services to affluent consumers, he said. Still, the index makes intuitive sense to me, within reason, he said. As a result of gains on Wall Street and a reduction of the top tax rate, the rich are getting richer. They are going to continue to be able to afford luxuries.
上一篇: 考研冲刺真题文章解析(8)
下一篇: 考研冲刺真题文章解析(12)
2016届高考英语阅读改错提升训练34 健康饮食(阅读理解)
2016届高三英语二轮复习【专题七】情态动词与虚拟语气(精品教学案)
2016届高中英语必备单词知识点(素材)英语中常见的比喻词组
2016届高中英语必备单词知识点(素材)高频单词词组总结
2016届高中英语短语知识点《Unit 3 The Million Pound Bank Note》学案 新人教版必修3
2016届高中英语短语知识点《Unit 2 English around the world》学案 新人教版必修1
2016届高三英语二轮复习【专题四】介词、连词与状语从句(精品教学案)
2016届高中英语短语知识点《Unit 4 Body language》学案 新人教版必修4
2016届高中英语短语知识点《Unit 3 Travel journal》学案 新人教版必修1
2016届高中英语短语知识点《Unit 1 Friendship》学案 新人教版必修1
2016届高中英语短语知识点《Unit 3 Computers》学案 新人教版必修2
2016届高中英语必备单词知识点(素材)与中秋节相关的英语单词
2016届高三英语二轮复习【专题五】动词的时态和语态(精品教学案)
2016届高中英语必备单词知识点(素材)it用法考点聚焦
2016届高三英语二轮复习【专题十】特殊句式与交际用语(精品教学案)
2016届高中英语必备单词知识点(素材)分类梳理记忆单词方法介绍
2016届高中英语必备单词知识点(素材)动词make,break,bring,get知识点精讲
2016届高中英语必备单词知识点(素材)高中英语介词by的用法归纳总结
2016届高中英语必备单词知识点(素材)下册重点单词和短语知识点总结
2016届高中英语必备单词知识点(素材)重点词汇短语总结大全(下)
2016届高三英语二轮复习【专题三】形容词和副词(精品教学案)
2016届高中英语必备单词知识点(素材)英城市英语词汇
Metonymy and synecdoche 修辞法:转喻和提喻
2016届高中英语必备单词知识点(素材)重点词汇短语总结大全(上)
2016届高三英语二轮复习【专题八】定语从句(精品教学案)
Got your number 我知道你打的什么算盘
2016届高三英语二轮复习【专题一】名词和代词(精品教学案)
2016届高中英语短语知识点《Unit 2 Working the land》学案 新人教版必修4
2016届高中英语短语知识点《Unit 1 Cultural Relics》学案 新人教版必修2
2016届高中英语短语知识点《Unit 3 A taste of English humor》学案 新人教版必修4