Is there an exchange traded fund (ETF) that tracks the spending habits of the rich?
Indeed there is: This summer the Claymore/Robb Report Global Luxury Index ETF (ROB) launched, and it has a higher expense ratio of 0.70% to match its pricey holdings. The ETF tracks the Robb Report Global Luxury Index that is made up of companies whose primary focus is to sell luxury goods and services. With only 40 holdings in the index, the U.S., France and Switzerland dominate this index, reports Zoe Van Schyndel for The Motley Fool. Currently, it’s up 7.6% for the month.
If the economy dries, luxury companies might not wilt as much as others because big spenders tend to shop no matter how the economy is doing. The bigger risk is that the fund is highly concentrated. Daimler Chrysler (DAI), Nordstrom (JWN), Polo Ralph Lauren (RL), and Wynn Resorts (WYNN) are just a few of the high-end names ROB drops. Ensure this ETF fits your portfolio’s needs before purchasing.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.