· The rise of Fast Fashion has propel some of the listed companies into global giants and the trend looks set to stay.
· The low selling price of fast fashion is thus not restricted to seasonal trends and their display is changed almost fortnightly instead of every quarter; and consumers are willing and able to revamp their wardrobe regularly.
· Focus on fast fashion brands which are benefitting from their depreciating base currencies (e.g. JPY, EUR) with substantial % of their earnings coming from region out of their home presence.
· 3 counters that might be interesting: Adidas, Fast Retailing (think Uniqlo) & Inditex (Think Zara)
· Adidas (70% of Revenue from Outside Western Europe), Inditex (40% of Revenue outside Europe)
· From a technical perspective, they are bouncing off their long term lower boundary channel which might prove to be good levels for accumulation ahead of the Santa Claus Rally.
· From a structured solutions perspective, the 3 counters have high vols (20s to 30s) which might present attractive pricing parameters.