Redemption for collective investors?

2014-06-03

Nobles Crus, once thought to have been the world's largest wine fund, has allowed certain shareholders in the collective investment vehicle to exit their positions, notwithstanding Luxembourg's financial watchdog order last year to suspend all redemptions and subscriptions.

Investor Protection Europe, a consumer protection organisation, cites this sweetheart deal as an example of lax regulation and called it 'a clear violation of the rights of minority shareholders'.

Notwithstanding, the arrangement may come as a relief to key players in fine wine producing regions such as Bordeaux, whose wholesale distributors had been concerned about the risk of such a large volume of fine wine hitting an already uncertain market. If other shareholders were to follow suit and take a partial reimbursement in settlement, the risks of a large volume of fine wine hitting the market could be partially mitigated.

Private investors choosing to put money into Collective wine funds should know that Wine Owners provides a rigorous solution for fund management, fund valuation and provides a comprehensive audit trail of price calculations to wine funds including those regulated by the Financial Conduct Authority (FCA).

Wine Owners valuations reflect the realistic price that wines are likely to fetch in the global secondary fine wine market, and therefore the solution represents the single most credible analysis and oversight tool for those funds whose holdings are diversified across different fine wine regions of production.

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