Investing in a K-Shaped Economy

Original Reddit post

The author describes a barbell portfolio long Aritzia and Dollarama to play a K-shaped US consumer economy, with both positions up sharply since purchase.

ATZ.TO — LONG The author says they bought Aritzia as the high-end leg of a K-shaped economy, because roughly half of US consumer spending is driven by the top 10% of earners who are largely maintaining discretionary spending. Aritzia serves those higher-income consumers, and the position is up about 168% since purchase. The author is not fully convinced it is the optimal long-term K-shaped exposure but sees it as part of a barbell that may outperform a shrinking middle.

buying Aritzia (TSX: ATZ) and Dollarama (TSX: DOL), positioning myself at both ends of the consumption spectrum.

DOL.TO — LONG The author bought Dollarama as the lower-end leg of a K-shaped economy, expecting lower- and middle-income households to trade down or cut back while rising prices and tariffs squeeze them. Dollarama is positioned to benefit from consumers trading down to discount retail, and the position is up about 43% since purchase. The author is still not certain this is the optimal long-term K-shaped exposure.

buying Aritzia (TSX: ATZ) and Dollarama (TSX: DOL), positioning myself at both ends of the consumption spectrum.