Are Luxury and Retail Stocks Actually a Good Investment?
Luxury companies have been on a tear recently, with three straight years of double-digit market growth fueled by Chinese shoppers. Stock from Burberry, LVMH, Ralph Lauren, and Tiffany and Co. stock have all outperformed the broader market over the past five years.

But, beware! The performance of retail stocks is as fickle as the fashion world itself, and you never know when a designer’s fortunes will suddenly fall. (Hello, Galliano.) Plus, just because they’ve done well over the past five years, doesn’t mean luxury and retail will continue to go up forever. Memorize this: Past performance is not an indicator of future performance.

Finally, even if you have a front-row pass to Fashion Week, you probably don’t have the time to put in 70 hours a week crunching inventory and cash-flow numbers like professional investors do, putting you at a disadvantage when trying to buy and sell stocks at the right time.