Hagerty. “Are Classics Finally Cooling

Compared to the markets this is a good outcome. However, we are acutely aware that the Fund's results were negatively impacted by the relatively little new investment to take advantage of numerous buying opportunities. Given acquisition returns are an immediate source of double digit return opportunities, they can have significant benefits, of which we were devoid of this quarter.

We know from our discussions with potential investors that some people are holding out for fear of what the car market will do. Several observers have all been wondering how long the collector car market’s historic hot streak can carry on, and what the inevitable fall-off might look like. There have been concerns that the market had already peaked, that economic uncertainty would register even with the ultra-wealthy, or that maybe there was simply more great stuff on offer than there could possibly be 5buyers.

So, what does happen when a red-hot collector market is pitted against a cooling economy? Despite external variables continuing to threaten to put a damper on enthusiasm for buying collector cars, the truth is that macroeconomic factors don’t affect classic car buyers—or the vehicles they want—equally. 6,7

As we explore in this report, not only is now the time to hold onto your collector cars - it's actually an opportune time to buy. If the Fund can capitalise on this favourable buyer's market, then, when coupled with the instant appreciation uplift from the soon-to-arrive Aventador, the Fund's returns are wealth preserving at worst and strongly promising at best.