Aside from being the world's top-earning supermodel for the 7th year in a row, Gisele Bundchen is also a great investment. That's according to economist Fred Fuld, who created, in 2007, a stock index which charts the performance of companies represented by Bundchen in comparison with the Dow Jones Industrial Average.
At the time, Fuld found out that the Gisele Bundchen Stock Index was up 15% between May and July 2007, substantially surpassing the Dow, which was up just 8.2%. With a list of clients that includes powerhouses such as LVMH, News Corp. and Procter & Gamble, Bundchen's stock index was up 29% by the end of 2007, while the Dow had a gain of 6.5%.
In his report, Fuld cited the example of Bundchen's contract with German automobile manufacturer Volkswagen to stress the supermodel's business savvy. "She could have become the spokeswoman for General Motors of Ford, both of which have received government bailouts and may yet declare themselves bankrupt. But Volkswagen is in much better shape, and is even considering buying Porsche."
Bundchen's long relationship with Victoria's Secret was also the subject of Fuld's attention. In May 2007, the supermodel announced that she would not renew her contract with the lingerie company, which reportedly paid her $5 million per year. Soon after the news of the break-up came out, the shares of Victoria's Secret parent company, Limited Brands, fell 31.5%. And even though the Gisele Index was down 15.7% between 2007 and 2009, it still managed to outperform the Dow, which was down over 30% during the same period. Just last week, Fuld updated his numbers on the Gisele Bundchen Stock Index.
Here's an excerpt from his report:
The Gisele Index is UP 41% since January 2007 versus the Dow which was DOWN 4% during the same period. Since January 2008, Gisele was up 39% versus a drop of 4% for the Dow. And since January 2009, Gisele rose 67%.
According to Fuld, the Gisele Index could have had a better result should the supermodel's contract with Apple had been extended (Bundchen appeared on the 'Get a Mac' advertisements to promote a new line of Macintosh's a few years ago). "If Apple was still in the index," he wrote, "her return would be significantly higher." Last September, Bundchen was the theme of a special business documentary [VIDEO] aired by Brazil's leading news channel, Globo News, during which ad man Mauro Silveira, who works at the Giovani+DraftCB agency and has worked closely with Bundchen in the past, spoke on the supermodel's strategy when considering new clients. "Before any negotiation, Patricia [Bundchen's twin sister and manager in Brazil] will request as much information as possible, like what is the company's main activity, who leads the company, and, from there, her team will do a research work to check if she can benefit from a possible partnership or not," Silveira explained.
Such caution seems to be paying off not only for Bundchen, but for her clients as well.