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Classic cars 'hedge fund' launched


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#1 mariner

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Posted 21 January 2011 - 20:35

This may be old hat but I have just seen it

http://www.freep.com...top-sports-cars

Interesting to see some of the principals in this - the start of a trend?

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#2 BRG

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Posted 21 January 2011 - 21:41

Ughh! People who want to make a 15% return on classic cars (or great works of art, come to that) shouldn't be allowed within 100 miles of any of them. I know that nothing is sacred in this world....but is nothing sacred?

#3 arttidesco

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Posted 21 January 2011 - 21:48

Another financial instrument to drive up the price of old motor vehicles :rolleyes:

I have to wonder how serious a scheme like this can be, everyone know's that keeping a classic car costs money even in relatively static storage, as the price of any particular classic goes up it can only drive the price of rare spares parts up.

While I am sure some classics will rise more than others I am equally sure no one is better qualified to say precisely which those will be better than anyone else, but then I am equally sure no one is better qualified, to say which shares in any particular market will perform better than others, than anybody else, at best hedge funds are well informed gambles.

Wish anybody with the minimum £500k to gamble all the best :stoned:

#4 Tim Murray

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Posted 21 January 2011 - 21:52

This sort of thing started happening back in the '80s, didn't it? - and then look what happened.

#5 Ray Bell

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Posted 21 January 2011 - 21:57

How many investors would they need to buy a Bugatti Royale?

Or to cobble up a replica built around a railcar engine?

#6 RA Historian

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Posted 21 January 2011 - 21:57

Perhaps I am too much of a cynic, but I cannot see any good coming out of this. It will both drive up the price of cars and, probably more importantly to the majority of us here, take more out of circulation and into hiding. In two words, not good.
Tom

#7 Tim Murray

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Posted 21 January 2011 - 22:28

Agreed absolutely.

#8 elansprint72

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Posted 21 January 2011 - 23:02

I'm not sure that I believe some of the copy in this piece. I'll make enquiries.

My advice is to go long on coffee.

#9 Vitesse2

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Posted 21 January 2011 - 23:03

I suppose all those wbankers need something to squander their bonuses on. :rolleyes:

#10 Bloggsworth

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Posted 21 January 2011 - 23:06

I've put cars in hedges a couple of times, but never funded one........

#11 elansprint72

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Posted 21 January 2011 - 23:27

I've put cars in hedges a couple of times, but never funded one........


Now that comment, imho, epitomishes the spiritsh of thish forum, offisher. :smoking:

#12 Zagato_Olaf

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Posted 26 January 2011 - 18:00

Dear members,

This way of doing business will work as long as 'investors' think that a specific group of cars will keep increasing in value more than average. Yeah right!
It means that cars will have to be sold at a substantially higher price than they were bought for, taking costs like auction, storage, maintenance, etc into account.
And the time between buying and selling will have to be limited in order to make enough money to satisfy the members of the fund.
Cars will become reachable for an even smaller group untill funds like this and very rich individuals are selling to each other only.
As soon as 'the market' thinks that the peak in prices has been reached, the bubble will blow and people will stop buying and/or start selling.
So the trick will be to withdraw from the fund before the prices reach the top and the market will go down.

But of course, we all know that this is the mechanism and that the bubble will blow sometime in the future. Didn't something like this occur at the end of the eighties?
People tend to forget what happened in the past and make the same mistakes over and over again.

My advise? Just buy the car you are passionate about and do not bother about the value it will have in future.
But that is common knowledge as well! Just my 2 cents.

Ciao, Olaf

Edited by Zagato_Olaf, 26 January 2011 - 18:00.


#13 fbarrett

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Posted 27 January 2011 - 00:17

Anyone with the $500K minimum investment (and half a brain) can do better by buying a car themselves--and have fun with it as a priceless bonus! The only folks assured of making money off this fund would seem to be those running it (fees, etc.).

Frank

#14 hipperson

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Posted 27 January 2011 - 16:10

I was looking for a Lagos address..............

#15 Peter Morley

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Posted 01 February 2011 - 15:51

The only folks assured of making money off this fund would seem to be those running it (fees, etc.).
Frank


Isn't that always the case and one of the main causes of the current financial difficulties...

Hopefully it is aimed at bankers who will invest their hard earned bonuses and, with any luck, will end up losing their "own" money in the same way as they do their clients...


#16 Sharman

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Posted 01 February 2011 - 17:20

A number of years ago I was at race with a well known driver who is a friend of many years standing. This friend was, what in my younger days was known as a hired gun, ie he was a bloody sight faster than the owner. In the bar I tried to buy a round and was brusquely told hold on to your money by my pal. It is not that it is not appreciated I was told, but it is not necessary. Last year the car's owner made £16000000 in bonuses. Different worlds from the rest of us.
And then there was the other pal who sold out for multi-millions, when we went to stay I was told that it was my turn to buy the loo rolls.......
You never know where you are with the rich,