Long-term investors should look to luxury goods

published 6 May 2019

A professional investor tells us where he'd put his money. This week: Zehrid Osmani of the Martin Currie Global Portfolio Trust selects three favourites

The rapid expansion of the emerging-market middle class is a key long-term growth theme. In China alone, the middle class is expected to more than double over the next ten years, while the segment defined as affluent is forecast to grow even faster. As a result, one area of interest over the coming decade and beyond is luxury goods.

We expect growth in the emerging-market luxury sector, especially in China, to continue to outpace global growth and accelerate as price harmonisation, more sophisticated marketing and e-distribution democratise access. With global markets worried about a short-term slowdown, this may prove a good opportunity for long-term investors to consider this structural growth story. The following companies offer excellent exposure to the theme.