The Australian Chamber Orchestra (ACO) is targeting sophisticated philanthropic investors with a new wholesale fund aimed at benefiting from the appreciating value of rare musical instruments.
With an Australian Financial Services Licence provided through JB Were, the other purpose of the fund is to provide high quality musical instruments to musicians in the ACO, with assets loaned from the fund trustee (the Australian Chamber Orchestra Instrument Fund) to the orchestra to be played by the musicians.
The wholesale unlisted unit trust will feature a unit price of $50,000, with a target capacity of around $5 to $10 million and an investment horizon of 10 to 15 years, with limited redemption opportunities every three years, according to ACO director Brendan Hopkins.
In the past 10 to 15 years the types of assets the fund will be targeting – which include a Stradivarius violin worth $1.6 million that the fund has already purchased – have returned around 7-10 per cent compound, he said.
The fund is hoping to appeal to the philanthropic investor who would not only benefit from the financial returns but also appreciate the musical aspect, he said.
“While it is not unusual for musicians to receive rare and valuable instruments on loan, ordinarily they are lent by wealthy individuals or philanthropic organisations who retain ownership,” he said.
“In this case, the instruments remain under the stewardship and control of the orchestra, and in the ownership of the fund. This is for the long-term benefit of investors, the musicians and the listening public.”