The Value of Nobles Crus

What is Nobles Crus Fund?Nobles Crus Fund

Nobles Crus is the only Luxembourg monthly open fund investing in the fine wine sector. The objective is to generate optimal gains over the long term via the purchase, storage and sale of carefully selected classified grands crus (70%), en primeur wines (20%) and liquidity (10%).
It is a simple product, not correlated to the equity and bond markets, that combines tangibility and profitability.

Against an economic background of unprecedented turbulence, Nobles Crus has demonstrated strength and resilience. It is a tangible product that has good price stability and strong market demand as the supply (its production) is finite by nature and cannot be extended, whereas demand is constantly increasing. Wine also improves in quality as it ages, thus further increasing its price.
 

How does it work?

Nobles Crus operates like a standard fund and is managed with all the rigour and transparency that such fund requires. Information about the fund is published on a regular basis. It is open-ended and does not have a fixed lifetime. Shares may be subscribed or redeemend without prior notice each month on the basis of the monthly net asset value. Subject to the manager’s approval, subscriptions and redemptions can even be made in kind. You thus have the option of monetising your own collection or of accessing, at merchant prices, a wine cellar housing outstanding crus that are extremely rare on the markets.

The wine Portfolio

Nobles Crus’ Portfolio is composed by 63,000 or so bottles en primeur wines and bottled wines, either premier crus or similar wines, in recent and old vintages, predominately from Burgundy and Bordeaux but also from Italy and Spain. We have also identified a number of exciting opportunities in California and Australia. Among the portfolio’s main holdings are Latour, Romanée-Conti, Cheval Blanc, Petrus, Ausone, Barolo e Vega Sicilia.

The Grand Crus and the en primeur wines from Nobles Crus are selected and bought directly from wine merchants, restaurants, private collections and are all stored in a secure cellar at Geneva Free Ports. This warehouse is considered as a risk free zone for insurance and provides optimal storage conditions for fine wines, with stable temperatures and humidity levels that are monitored around the clock by an oenologist. The premises are secure and merchandise is inspected and checked off upon reception. The Free Port status is of particular interest to wine merchants. Nobles Crus’ fine wines delivered to these premises are exempt from VAT that only becomes payable by the purchaser as and when the grands crus are sold, months or years later.

Valuation

The wines in the portfolio are valued every month on the basis of four price lists, two of which come from wine merchants in Continental Europe and the United Kingdom, and two of which come from leading auction houses such as Sotheby’s or Christie’s. In total, around sixty wine merchants may be used as a basis for the valuation. This comprehensive valuation process also includes an annual review of our merchants to ensure their pricing policy is correct and their
quality standards meet our criteria.

The prices of wines in the portfolio are monitored by Laurent Vialette, wine expert for the Revue des Vins de France magazine and member of the Association des Sommeliers de France. Laurent Vialette is a renowned international specialist in older vintages that conducts an independent valuation of the Nobles Crus portfolio.

Liquidity management

Cash management is carried out in a highly controlled fashion, with a minimum of 10% of the assets being held in cash in order to facilitate possible redemptions.
This cash is invested in money market funds or term deposits.
We also ensure that no client holds more than 10% of the fund. Should an investor wish to hold more than 10% they must agree to certain conditions regarding redemption before their request is approved.
The portfolio includes a selection of highly “liquid” wines such as Lafite-Rothschild (18%) and Romanée-Conti (17%) for example. These are the best vintages of the most famous wines in the world and demand for wines such as these provide additional liquidity.
With more than 300 auctions every year internationally there will always be many immediate opportunities to liquidate portfolio assets should the need arise.

Nobles Crus’ fund managers

Nobles Crus is managed by the Milan-based company Vino e Finanza since 2008,

who focus solely on purchasing the finest wines and the most sought-after nectars for the fund’s portfolio.

The fund manager is Christian Roger, Vino e Finanza’s CEO and permanent member of the European Grand Jury of Wine Tasting since 2006. He is also a member of the Romanéens, a wine-tasting association for the wines from the Domaine de la Romanée-Conti. Christian is co-owner of L’Atelier del Vino in Milan and in 2009 was appointed ambassador for Krug in Italy.

The Nobles’ Crus Co-Managers and Vino e Finanza Co-Administrators are Marco Clerici and Averardo Borghini: The first one monitors the market trends, analyses sales and price figures from auctions houses around the world and is responsible for the logistics of transportation; the second is responsible for international purchases and is often asked to deliver presentations and speeches to professional associations. Previously he was a consultant for WineTip, an established Milan-based wine merchant.

Key elements - Nobles Crus

Launch date: 21/11/2007

ISIN Code: LU0332753077

Bloomberg Ticker: ELTNOBL LX

Management team: Christian Roger (Manager); Averardo Baldovinetti (Co-Manager); Marco Clerici (Co-Manager)

A monthly net asset value: calculated on the basis of 4 international transaction prices taken from 2 auction houses and 2 wine merchants.

Subscription: it is possible to invest in several ways:
directly
via a management mandate,
or through an insurance company

Subscription and redemption in kind: subject to the manager’s approval, subscriptions and redemptions can be made in kind.

Recommended investment period: 3 to 5 years

Allocation of income: accumulation

Financial year end: 31 December

Auditors: Deloitte

Law Firm: Allen&Overy

Insurer: Allianz

Custodian: Caceis

Storage: Geneva Free Ports

 

FactSheet Nobles Crus download pdf