Saturday, January 12, 2008
Could Designer Handbag Sales Limits Hurt Luxury ETF?
by Tom Lydon
The luxury exchange traded fund (ETF) could take a hit after retailers announced that they'd limit sales of luxury handbags.
That means you're out of luck if you were planning to run out this afternoon and buy a dozen Louis Vuitton bags. But really, the limits aren't because people just can't have enough luxury bags, reports Eric Wilson of the New York Times. The real reason is our falling dollar.
Because the dollar has slid in value relative to currencies such as the euro and pound, many foreign buyers are treating the United States as one giant outlet mall. They can get handbags here for (relatively) dirt-cheap, then re-sell them in Asia and Europe at a premium. Companies such as Prada and Gucci want to discourage that, as they've been trying to reach customers in those other countries by opening new shops.
How will this affect the Claymore/Robb Report Global Luxury ETF (ROB)? After the dismal holiday sales report issued today, might retailers want to take their sales where they can get them?
Among the holdings in the fund are LVMH Moet Hennessy Louis Vuitton (5.7%), Hermes (2.81%), Coach (COH, 2.5%), Burberry (BRBY; 0.97%) and Macy's (SKS, 0.60%).
That means you're out of luck if you were planning to run out this afternoon and buy a dozen Louis Vuitton bags. But really, the limits aren't because people just can't have enough luxury bags, reports Eric Wilson of the New York Times. The real reason is our falling dollar.
Because the dollar has slid in value relative to currencies such as the euro and pound, many foreign buyers are treating the United States as one giant outlet mall. They can get handbags here for (relatively) dirt-cheap, then re-sell them in Asia and Europe at a premium. Companies such as Prada and Gucci want to discourage that, as they've been trying to reach customers in those other countries by opening new shops.
How will this affect the Claymore/Robb Report Global Luxury ETF (ROB)? After the dismal holiday sales report issued today, might retailers want to take their sales where they can get them?
Among the holdings in the fund are LVMH Moet Hennessy Louis Vuitton (5.7%), Hermes (2.81%), Coach (COH, 2.5%), Burberry (BRBY; 0.97%) and Macy's (SKS, 0.60%).
Labels: authentic gucci handbags, authentic hermes handbags, authentic prada handbag, brands boutique, burberry, discount luxury, louis vuitton handbags, luxury handbags and accessories, luxury vintage
# posted by Give Me Something to Blog About @ 9:58 AM 
