Where to Invest: How to get rich by buying luxury

Metro’s weekly column, Where to Invest, is for anyone looking for fresh ideas and insight into where they might put their savings.

You know what they say: buy cheap, buy twice.

For the richest people in the world, that probably doesn’t apply but for the rest of us, knowing when to invest in quality over quantity is key to making the most of our money.

That might mean spending a little bit more on a good winter coat that will last you longer than just a year.

But there are other ways to invest in quality and, in the process, hopefully get richer.

How? You don’t have to buy the Ferrari itself to jump on the rich list bandwagon.

Here, we take a look at three funds which do the hard work for you.

Pictet Premium Brands

Caroline Reyl, Pictet Premium Brands fund manager, says: ‘Consumer sentiment worldwide in 2025 was deeply impacted by political and economic uncertainty. This is generally not a good environment for luxury goods but the consumer has been surprisingly resilient.

‘We’ve seen little change in appetite for premium brands amongst the higher end consumer though the more aspirational consumer has been a little sluggish – suffering higher pricing and greater uncertainty.

‘In the interim, premium brand companies have had the chance to reorganise, innovate and look to re-engage with their aspirational consumer.’

‘We’ve seen new designers across major fashion houses, new partnerships with sporting events and sports brands, as well as revamped boutiques focused on experiences.

‘The Louis – the newest a Louis Vuitton concept store shaped like a ship in Shanghai -attracts around 40,000 visitors in a weekend, lured by cultural exhibits, food and beverage outlets and as well as the promise of a unique shopping experience.

‘With so much “new” in the making, and companies having rerated to lower valuations, we may arguably see a good set up for premium brand consumption going forward.’

BlackRock European Dynamic

Billy Ewins, fund research analyst at Quilter Cheviot, says: ‘This fund owns Hermès and Richemont – both stocks you could classify as being higher-high end names given high inelastic demand of the products due to their exclusivity.

‘This could be seen as a hedge against a deteriorating picture of the middle-class consumer and the superior pricing power of ‘hard’ luxury.  

‘They also hold LVMH, a conglomerate that owns a number of recognisable companies such as Dior, Celine, Tiffany and Louis Vuitton.

‘The business is undergoing several structural changes with, for example, a new designer at the helm at Dior, which means many analysts are closely watching new products and the customer reactions to these.’

‘Many other fund managers reduced into 2025 their luxury exposures as they waited for the market to digest the sharp realignment of sales growth and are in ‘wait and see’ mode as the new designers get to work. 

‘However, this fund clearly has more confidence in this change and is happy to be there as early as possible.’

Schroder European Recovery

Jemma Slingo, investment specialist at Fidelity International, says: ‘Investors interested in luxury stocks might want to consider the Schroder European Recovery Fund.

‘It invests heavily in the consumer discretionary sector and has recently beefed up its luxury exposure.

‘In the first half of 2025, for example, it bought French giant Kering, which owns the likes of Gucci and Balenciaga. This addition has paid off nicely so far.’

‘I like the fund’s disciplined, contrarian approach: it’s not afraid to find companies that are going through tough times.

‘This comes with obvious risks, but it has yielded some impressive results in the past.

‘Given the nature of the fund, it is best suited to investors with long time horizons. It tends to come into its own over periods of five years or more.’