A mainstay of malls and shopping centers across the U.S. in the 1990s, Gap Inc. (GPS) is today a clothing and accessories retailer with operations around the world. Founded as a jeans shop in San Francisco in 1969, Gap today sells a wide variety of products for men, women and children, including sportswear, activewear, and more.

The company’s six primary divisions include retail outlets The Gap, upscale store Banana Republic, discount retailer Old Navy, fitness wear brand Athleta, curated fashion site Intermix, and Hill City, a maker of performance menswear. 

As of 2018, Gap’s revenue was $16.6 billion and it was the largest specialty retailer in the U.S. It currently operates more than 3,700 stores worldwide, more than 60% of which are in North America.

Rationale

The most direct way to gain exposure to Gap is to buy its listed shares, of course, but its participation in the extremely competitive retail and fashion markets might make many reconsider that approach. Companies like GPS have to stay ahead of the constantly shifting trends in fashion in order to remain competitive in the marketplace. What’s more, Gap’s reliance on mall and shopping center locations puts it at risk as consumer choice moves away from brick and mortar shopping to more online purchases.

However, for investors interested in gaining exposure to the retail and consumer spending sector, rather than buying GPS shares themselves should consider buying funds that provide exposure to Gap and other similar firms. After all, the return drivers that will benefit GPS might also benefit other similar tech firms. As investment management is gradually moving to the construction of portfolios using ETFs and mutual funds in addition to single stocks, investors would do well to consider gain exposure to firms like Gap through these types of funds.

Investing in GPS

A search on Magnifi suggests that investors can gain access to GPS via a number of different funds and ETFs, including those shown below. 

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