What’s the most visible legacy of Covid in everyday life?

The odd mask still being worn on public transport? A faded sign explaining, in intense detail, how to wash your hands? A Perspex screen somewhere it really doesn’t need to be?

I think it’s something else. Office fashion.

In fact, in the UK, men’s suits were taken out of the ‘representative’ inflation basket in 2022* – if no one’s buying them, they aren’t representative!

Loaded question: imagine I’d given you perfect foresight on this trend towards casual and away from formal back in 2022. Armed with this information, if you had to buy the shares in athleisure super-brand Lululemon or ‘stuffy’ Marks & Spencer, who would you have backed?

Prepare to be as shocked as someone seeing the price tag of a pair of premium-brand leggings for the first time.

In the past couple of years, Lululemon’s stock has basically gone sideways, while M&S’s share price has doubled.

The thing is, even if you know exactly what the world is going to look like, it doesn’t always translate to share price performance.

There are lots of specific reasons Lululemon has struggled – there’s only so much money you can spend on tracksuit bottoms, clothes wear out less quickly at home, other brands have emerged to grab a slice of the market.

But the more interesting case is why M&S has thrived. As a business, it does something we think investors can learn from. It diversifies.

From food to clothing, to homeware, and even finance. So as their formalwear struggled, the rest of the business kept going, giving the fashion side time to adjust, ditch the formalwear, and evolve.