Classic cars rev up their investment credentials
A low throaty roar reverberates around the Sussex countryside as a procession of classic cars winds its way over the South Downs to the Goodwood Revival.
Out of pristine E-type Jaguars, AC Cobras and sleek Aston Martins step World War Two soldiers, Teddy Boys and spivs.
The Revival is an annual event where cars from the "golden age of motor sport" are admired and raced.
Here enthusiasts, dealers and racing drivers mingle - all dressed immaculately in period costume.
For many, the Revival is simply an opportunity to appreciate vintage engineering, but some attend for far more mercantile reasons.
Over the last 30 years or so the value of classic cars has risen inexorably.
Until recently the market was driven by enthusiasts who drove the cars as a hobby. The fact that the cars often rose in value was an unintentional side effect of what these connoisseurs call "automotive art".
However, as the economic outlook remains gloomy and the financial markets remain volatile, people are starting to invest more seriously in tangible assets like art, wine and classic cars.
This perhaps accounts for the eye-watering transactions carried out here at Goodwood.
On Friday, in a packed tent, Bonhams auctioneers sold a Rolls Royce Silver Ghost for £485,500, and a Ferrari 365 GTS/4 Daytona sold for £595,500.
This trend has been reflected in the classic car indices run by the Historic Automobile Group International (Hagi).
Its founder, Dietrich Hatlapa, says the indices have been performing particularly well recently, "showing very little correlation to the standard market".
He believes people feel safer investing in visible assets and "the rising price of commodities like gold offers separate proof of this".
The Hagi indices suggest that classic car sales are generating as much as a 12% return.
At the moment it's the vintage Ferraris that are giving drivers the biggest financial boost.
"They have performed best by a mile," says Mr Hatlapa.
The Ferrari GT Spyder - a car once owned the radio DJ Chris Evans - could be bought in the 1960s for $94,000 (£60,000). Today, these cars sell for a reputed $7m.
Mr Hatlapa credits their enduring success to the fact that they were built in small numbers, were technically sophisticated and were successful in various competitions.
The classic car market has been given a massive boost from the emerging markets.
A few years ago wealthy Middle Eastern and Asian enthusiasts were buying flashy super-cars to flaunt their new found riches.
But they soon realised that as impressive as cars like the Lamborghini Gallardo Coupe are, they can depreciate by as much as a $1,500 per week.
So, they have started to buy classic cars - and in particular those manufactured in Britain.
You only have to meet some of the drivers at the Goodwood Revival to understand that much of the joy of investing in classic cars comes from restoring and running them.
But a new hedge fund has been set up that has taken this hands-on involvement out of automotive investment.
IGA Automobile was set up by ex-racing driver Ray Bellm. He says he has spent the last 30 years watching the value of rare cars rise and rise.
The fund aims to buy $150m worth of some of the world's most iconic cars in order to sell them on at a profit some years down the line.
Among some of the cars Mr Bellm has his eye on is a Ferrari 250 GTO, an Aston Martin DB4 Zagato, and a McLaren F1. "We'll be looking at the heritage, quantity and perception of the cars," he says.
The group hopes to attract sovereign wealth funds and ultra high-worth individuals, and is offering them a return of 15%. But Mr Bellm admits that the greatest weakness of the fund is that the investors won't actually be able to drive the cars.
Of course, not all of us can afford to buy high end Ferraris or invest in hedge funds.
So is it worth buying a classic car from the lower end of the market?
"Absolutely, why not?" asks Dave Selby a classic car analyst.
"If you've got £5,000 sitting in an ISA why not put that money into a classic car? You'll get a lot of pleasure from it and won't lose money."
He says cars like the MGB Roadster and Triumph Stag will accrue value, and like all classic cars, when they come to be sold the owners don't have to pay capital gains tax.
But Mr Selby does offer some words of caution, and says that a classic car purchase must be properly researched.
"Before a car becomes a classic, it must have gone through the second hand market and reached the bottom of the depreciation curve," he says.
In other words, you shouldn't just buy any old banger from a second hand car dealer.
But, if you pick the right car - whether it's worth £100 or £1m - you gain an asset you can have fun with.
The material is for general information only and does not constitute investment, tax, legal or other form of advice. You should not rely on this information to make (or refrain from making) any decisions. Always obtain independent, professional advice for your own particular situation.