Make Money Buying Makeup

Dayana Yochim, The Motley Fool

Who says men are unwilling to stop and ask for directions?

For decades, investors have looked to ladies for signs about which way the economy was headed. During the Great Depression, the length of our skirts revealed how reserved (or racy) consumers felt about our financial means.

In the early 1990s, the tea leaves shifted, and cosmetics sales became the gauge for consumer sentiment. The so-called "Lipstick Indicator" was coined by Leonard Lauder, former chairman of Estee Lauder (which trades on the New York Stock Exchange under the ticker symbol "EL"). He noticed that sales of lipstick (a relatively cheap splurge) were outpacing purchases of higher-priced indulgences - a signal that correlated with consumers' uneasiness about the economy.

Use female intuition to boost your net worth
While my fellow stock picking chick Alyce Lomax and I appreciate Wall Street's acknowledgement of the power of female intuition, we're not pushovers for just any pretty-face-products manufacturer. (Just see what we said about Avon a few weeks ago.) Before we invest our money in the cosmetics industry, we want to be sure that we're picking a company whose good looks are more than skin deep. And we think Estee Lauder may be just the company to freshen up our portfolios:

What's in your beauty bag?
What do you think about Estee Lauder's bag of beauty tricks? Have you ever invested in a company because you love its products?

And, Just one more question: If you could take only one makeup item on vacation, what would it be? (For me, it's a close call between Makeup Forever's Mat Black Aqua Eyes eyeliner or Maybelline Moisture Whip Lip Liner in "Toast" (the old-school formula).)

For more investing ideas from the Stock Picking Chicks check out:

· A Lipstick Stock that Clashes With Your Portfolio

· One Word: Plastics. (as in "Tupperware")

· A Supermarket Stock That's Staying Fresh

· Put Some Pepsi In Your Portfolio

· A Retailer that Makes Us Swoon

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