Premier Cru uncorks wine fund

Premier Cru is to launch a fine wine fund aimed at investors seeking a safe harbour away from the turbulent equity markets.

The Premier Cru Fine Wine Segregated Portfolio, a Cayman Islands-based fund, will be primarily marketed at high net worth investors keen to diversify their portfolios.

The fund intends to invest in high-quality fine wines from chateaux where demand is likely to grow.

All investments will be for the medium and long term, and the group will aim to acquire wine through prudent professional management and provide a "consistent and viable" level of capital return.

It will also seek to find optimum exit strategies to ensure the underlying performance of the portfolio is enhanced by way of realised gains in fine-wine values.

According to Stacey-Lea Golding, chief executive at Premier Cru, during volatile periods such as now, most investors hold a lot of their portfolio in cash. But investing in wine, she said, would have the potential for greater returns.

"By investing in this fund, people are accessing a commodity, but also diversifying their portfolio into an uncorrelated asset that is unaffected by the equity market. By investing, they will become shareholders in a fund that holds some of the most desirable and exquisite wines available."

The portfolio is being managed by Tim Lock, director of XD Management.

Premier Cru will be the fund advisers, while Liv-ex will act as valuation agent for the assets of the portfolio.