Clariden Bank has launched the Clariden Luxury Goods Equity Fund aimed at the long-term private equit...
Dr. Scilla Huang Sun, vice president of Clariden Bank and fund manager of the Clariden Luxury Goods Equity Fund, said: " The investment strategy has been driven by bottom up stock selection and Clariden focuses on four main criteria when choosing companies.
"They are the quality of management, the strength of the product position, the financial strength of the company and the valuation."
Clariden's investment goals are "to achieve long term capital appreciation in excess of the MSCI Consumer Discretionary Index through investment in a diversified portfolio of equities in the global luxury goods sector."
Investors are expected to receive returns of 15-20% per annum.
The main segments of the luxury market are: apparel, leather goods, perfumes and cosmetics, jewellery and watches, wines and spirits, tableware, cars and motorbikes, boats, and hotels and leisure.
Beat Wittmann, chief investment officer of Clariden Bank, said: "Companies in the luxury goods sector are all about good management and usually have good long term family background."
They are also products which have strong branding and are related to an exclusive and wealthy lifestyle which create prices at the high end of the market.
The luxury goods industry is a global industry and has above average growth within consumer goods and the supply is largely European based.
Clariden estimates the demand size for the luxury goods market is 36% in Asia, 34% in Europe and 30% in North America.
Clariden believes the number of ultra high net worth individuals is increasing and so is the demand for the luxury goods industry.
Merrill Lynch World Health Report 2000 found the number of ultra high net worth individuals was 55,400 in 1999 compared to 46,900 in 1998.
The Clariden Luxury Goods Equity Fund expected top 10 holdings at launch are Hermes, Gucci, LVMH, Richemont, Estee Lauder, Bulgari, Tiffany, Porsche, Christian Dior and Harley Davidson.
There is a 2% management fee and a 1.5% placement fee.
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