HK tycoon bets on ‘diamonds are forever’ with $1.1bn jewelry fund – Low Calorie Diets Tips

HONG KONG — A Hong Kong life insurance tycoon is betting that multimillion-dollar antique necklaces and other rare trinkets can be a “haven” for ultra-wealthy investors seeking shelter from a turbulent global economy.

Billionaire Calvin Lo has launched what he believes to be the world’s first jewelry mutual fund, with a few dozen wealthy investors plowing around $1.1 billion into his “Legacy Jewelry Fund” so far.

Launched last month, the fund aims to source one-of-a-kind necklaces and other pieces from the world’s top jewelry houses, including Van Cleef & Arpels, Cartier and Bulgari, with the aim of generating record returns as value increases.

Traditionally, gold has been a more common safe haven asset when the economy has been faltering.

But the fund’s 42 investors, mostly from Hong Kong, are wealthy people who see value in “extremely high quality, really rare, highly collectible jewelry that only exists in a limited limited amount,” the 46-year-old Lo said in one Interview with Nikkei Asia.

With funds already invested, Lo said he enlisted the help of top jewelry experts to find and buy rare jewelry, although he has the final say on what is chosen.

Pieces must come with detailed ledgers to prove their authenticity and have cultural or historical value, such as Tutti Frutti, Cartier’s colorful jewelry set with emeralds, rubies and sapphires.

“Van Cleef & Arpels is known for its Art Deco period, as well as its pieces from the 1960s and 1970s. Cartier’s Art Deco pieces from the 1920s and 1930s are some of the house’s most iconic, including the iconic Tutti Frutti,” said Lo.

“You have to give it to the great houses that keep such incredible historical records and archives to ensure the story continues.”

The Hong Kong businessman, who bought Taipei’s Mandarin Oriental Hotel for a reported $1.24 billion and also invested in Formula 1’s Williams Racing in 2020, said he came up with the idea after signing a private one with a client Visited the British jeweler Graff.

Shown 1920s necklaces selling for a whopping €5 million or more, Lo was inspired to create a fund focused on this niche market.

“If I could corner it at some point, it would be a win-win for everyone, wouldn’t it?” Lo said, comparing it to Warren Buffett’s headline-grabbing 3,500 tons of silver purchase in 1997.

However, Lo will reveal little about the collection the fund has amassed so far, which he says is being held in a secure vault, and he won’t comment on what kind of returns he expects for his investors.

He also declined to show physical pieces to Nikkei, citing the fund’s strategy, instead providing images of diamond-encrusted necklaces and bracelets, including some with price tags of around €20 million.

Potential investors must view the fund, which he plans to double in “a very short time,” as a long-term investment and stay in it for at least two years, Lo said.

He acknowledged that the fund is still in its early stages and there is still work to be done in terms of its pricing and structure, including an exit strategy for investors.

However, he noted that in times of economic uncertainty and rising geopolitical tensions, people have a strong desire to invest their money in “passion investing.”

Strained US-China relations, Russia’s invasion of Ukraine and rising inflation have rattled global markets, but Lo says he’s not anticipating the direst of scenarios.

“For me, it’s more optimistic to say that (the outlook) will remain unchanged,” he added.

In fact, the pandemic has been a boon to its flagship business, RE Lee International, which insures the lives of the super-rich with hundreds of millions of dollars in premiums.

He also invests through private investment firm RE Lee Octagon, which runs the jewelry fund, and Lo said he has his eye on commercial investments in Singapore and his favorite city of London.

Lo didn’t say anything specific, but did suggest he “stayed in hotels.”

The insurance business operates from six locations around the world, including Seattle and Shanghai, and Lo plans to expand to London and Europe this year.

But now that he can’t fly around the world to meet clients – Lo traveled non-stop for more than a month before the pandemic – he has stayed in Hong Kong to give him more time with his daughter, whom he loves as a denotes inspiration.

He says he’s also had more time for philanthropy.

In addition to a charity focused on children, the environment and inequality, Lo founded the 195 Project last year. The global think tank promotes ideas from experts to address the economic and social challenges of the pandemic and make charitable foundations like its own more efficient.

“We often give what we think people want, but we should really just ask,” he said.

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