Rare Single Malts, a private equity whisky fund, has begun capital raising in Hong Kong, according to a statement from the firm.
The fund is also available to investors in Singapore, Malaysia, Taiwan and selected parts of Europe, the firm said.
The initial fundraising will focus on high net worth individuals, family offices and boutique institutional investors with the first close due 31 July. It is targeting to raise £20m ($24.78m), with a minimum subscription of £100,000.
The strategy provides access to mature and rare single malt scotch whisky assets. It will primarily target rare whisky casks that are between 15 and 40 years old, as well as bottles and collections of at least 30 years and 18 years of age, respectively, according to the statement.
“Faced with extreme market volatility and a prolonged global recession, investors are turning to alternative assets such as whisky to weather the storm,” Murray Holdgate, general partner at the fund, said in the statement.
“Whisky is fast becoming ‘liquid gold’, reflecting its growing status as a collectible asset that appreciates strongly in value due to its rarity,” he said.
The alternative asset class has outperformed other collectibles on a one-year and 10-year basis ending 2018, according to a Knight Frank’s 2019 wealth report.
Performance ending 2018
| One year | 10 years | |
| Rare whisky | 40% | 582% |
| Coins | 12% | 193% |
| Wine | 9% | 147% |
| Art | 9% | 158% |
| Watches | 5% | 173% |
| Cars | 2% | 158% |
| Furniture | 1% | -32% |
| Coloured diamonds | 0% | 122% |
| Stamps | 0% | 189% |
| Jewellery | -5% | 112% |
Source: Knight Frank
Similarly, another whisky strategy, The Whisky Invest Fund, was launched in 2014 and raised $12m by 2017.
Alts popularity
The launch of the fund comes at a time when alternative investments have become one of the most sought-after strategies by high net worth individuals in Hong Kong and Singapore.
According to a survey conducted by Cerulli Associates, managers based in Hong Kong and Singapore see the highest demand for alternatives among HNWI investors, with 91% and 86%, respectively, naming these as their top investments.
Overall, 70% of managers in Asia-Pacific said there is strong interest in alternatives.
“The demand for alternatives is evident among family offices, with multi-family office generally showing greater demand for strategies such as hedge funds and private equity,” the report said.
“Competition from managers offering exotic investment strategies is viewed as the main challenge for managers in tapping wealthy clients,” it added.
