SGAM Global Luxury & Lifestyle Fund ("GLLF") is the first of its kind open-ended equity fund for the Singapore retail market that invests in premium luxury and lifestyle companies on a global scale.
A Case for Luxury
The financial health of high net worth individuals is estimated to hit US$44.6 trillion by 20101
. Given current macroeconomic conditions, average annual growth is expected between 6% and 8% over the next few years2
. Whilst Japan, the US and Europe continue to be the driving forces of the luxury market, emerging countries are catching up fast with the Chinese accounting for 20% of total sales in 2009, overtaking US customers by 2009 and becoming as important as the Japanese by 20143
The beneficiaries of this increasing number of affluent individuals will be the providers of luxury and lifestyle products. Luxury goods companies are now capitalising on this favourable market sentiment and entering aggressively into the new markets. The Compagnie Financière Richemont Group, one of the world's leading luxury goods groups, with prestigious brands including Cartier, Van Cleef & Arpels, Baume & Mercier and Montblanc, witnessed an impressive 64% increase in group sales in China for the six months ended September 20064. Cartier was in fact the first luxury brand to set-up in China in 1990 and has opened seven new outlets in the last six months5.
SGAM Global Luxury & Lifestyle Fund
Capitalising on this accelerating growth and demand for luxury goods and services, SGAM has introduced the GLLF - the Singapore retail market's first equity fund that invests in international luxury and lifestyle companies. This fund is an opportunity for investors seeking potentially strong capital growth from the Luxury and Lifestyle sector.
The GLLF feeds directly into the Luxembourg registered SGAM Fund/Equities Luxury & Lifestyle6, which replicates the successful French mutual fund SGAM Invest Secteur Luxe. This portfolio is benchmarked against the MSCI World Textiles, Apparel & Luxury Goods Index. Since inception in October 2002 to end-November 2006, SGAM Invest Secteur Luxe's annualised return is 24%7. SGAM Invest Secteur Luxe has also attained a Standard & Poor's 5 Star ranking since October 2005 in recognition of the fund's performance.
Why SGAM Global Luxury & Lifestyle Fund
- Accelerating demand for luxury goods due to new wealth in emerging countries like China, India, Russia and Latin America.
- First equity product in Singapore's retail market that focuses on the Luxury and Lifestyle sector that includes high-end watches & jewellery, lifestyle and fashion, travel & tourism, luxury cars, motorcycles or boats, wine, champagne and spirits.
- Fairly price-inelastic consumer demand for recognised brands.
- Large sector universe, which allows the fund manager to shape the fund's risk profile. With a potential universe of 140 companies in Europe and the US, the largest holdings in the portfolio as at end-October 2006, include flagship names such as LVMH Group, Christian Dior, Porsche, Luxottica Group, Richemont Financiere, and one of the world's largest distributors of wines and spirits, Pernod-Ricard SA.
- Active management that takes clear positions and relies on quantitative analysis from an experienced team specialised in the management of luxury sector equities.
Fund name: SGAM Global Luxury & Lifestyle Fund
Offer period: 15 January 2007 to 28 February 2007
Benchmark: MSCI World Textiles, Apparel & Luxury Goods Index
Currency class: USD/SGD
Minimum investment: US$1,000 / S$1,000
Preliminary charge: 1% to 2.2% at dollarDEX8
Annual management fee: 1.5%
Mode of subscription: Cash, SRS
- Merrill Lynch & Cap Gemini, World Wealth Report 2006
- Lehman Brothers estimates
- Merrill Lynch, Lap of Luxury, 2 September 2005
- Compagnie Financière Richemont Group Interim Results 2006
- Moneyweek - Luxury goods market: Full of Eastern promise, September 2005
- SGAM Fund/Equities Luxury & Lifestyle was launched on 7 December 2006
- Performance data of the mirror fund SGAM Invest Secteur Luxe, nett of all fees, in USD, annualised, with monthly data, as of 30 November 2006. Past performance is not indicative of future performance.
- Exceptions apply, see our pricing scheme for investments.
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Page last updated 15 Feb 2007