China to launch first wine investment fund
August 29, 2011 Category Finance, Weekly
China plans to launch its first wine investment fund. The Dinghong Fund plans to raise CNY1 billion and will invest in vintages from Bordeaux and Burgundy. Société Générale said last year that it was waiting for regulatory approval to invest in Bordeaux wines for its private banking clients. But Dinghong will be the first to offer something in China modeled on the wine investment funds – such as the Vintage Wine Fund – that have gained popularity globally over the past decade. For a minimum investment of CNY1 million, investors will be locked into the fund for five years. The wine expertise in the venture will come from Zhang Yanzhi, China Representative of Etablissements Jean-Pierre Moueix, a renowned Bordeaux winemaker and distributor. The fund said it expects to deliver annual returns of about 15%, an enticing prospect for Chinese investors who have seen inflation chip away at their savings with few hedges at hand. China has already had a huge impact on the wine world, taking up the slack from weaker demand in developed nations after the global financial crisis and pushing prices back towards all-time highs. Earlier this year, the Shanghai government established the country’s first official wine exchange – an internet platform to connect investors with approved suppliers, the Financial Times reports.
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