Last year, auction house Sotheby’s sold a rare Jaguar C-type Lightweight for $13.2m, breaking records for the most expensive Jaguar ever sold.
While dropping an eight-figure sum on a car may seem like madness to many, it’s unlikely the buyer will use this rare machine for the school run or to shop for groceries. More likely, it will sit in a warehouse and — the buyer hopes — appreciate in value.
A person buying a rare car and selling it once its value has increased (also known as “passion investing”) is nothing new. But in recent years a new trend has emerged, with the creation of classic car “funds” that allow individual investors to profit from classic cars, without actually buying one or paying for storage and maintenance.
Essentially, investors will put money into an investment fund, which then buys classic cars on their behalf. When the cars are sold for a profit, the investors make a return on their money.
Steve Linden, in New York, is co-manager of one such fund. Watch the video above to see what’s driving this new investing trend.
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