The Fund: Investment Thesis

May 15, 2024
The Perfect Storm For Value Creation

Aligning With An Investment Proposition
Our objective with the CHROME TEMPLE Investments Mach 1 Fund (the “Fund”) is simple: make returns from the acquisition (buy low), hold, and liquidation (sell high) of high-performance vehicles - the kind that ignite your imagination. And while the premise may sound uncomplicated, the interpretation of ‘generating returns from performance cars’ can be interpreted in many ways, swayed this way and that, across multitudes of marques, models, eras and categories, by the personal prejudices of whoever you might ask.

When deciding where to invest your hard earned capital, it’s intrinsically part of any investment process that you decide whether you buy into the proposition (thesis), whatever the asset class. And it’s no different for an alternative investment class, like cars, with each potential vehicle genre (current classic, future classic, muscle, pre-war etc) possessing its own merits, along with varying financial return and risk profiles.

Your understanding and alignment with a fund’s thesis is ultimately the most important decision, as the thesis ultimately tells you where and how the fund plans to make its money. And it’s no different for the Mach 1 Fund, which is why we’ve spent so much time validating our investment philosophy before launching. Across all the various components that go into a well governed and structured fund, our investment thesis is the Fund’s guiding north star behind every decision.

The Perfect Value Storm: Rarity & Demand
There are occasional and fleeting moments in time, when certain variables align to create extraordinary market conditions for potentially exceptional returns.

It’s the unwavering belief of CHROME TEMPLE Investments that we are in the beginning stages of experiencing the perfect ‘value storm’ of exceptional rarity combined with exceptional demand. Even while there are 31 million vehicle investors and countless enthusiasts worldwide, the days of naturally aspirated, large capacity, manual transmission cars - the true drivers’ cars - are truly numbered.

With increasingly constrictive emissions regulations forcing electrification and hybridisation, we are now witnessing in real time the swan songs of OEM manufacturer’s flagship “ICE” (internal combustion engine) vehicles, as the last-of-their-kind, roll off the assembly lines in Maranello, Sant Agata, Stuttgart, Crewe and Woking. They will be the last pure internal combustion engines legally allowed to be made for the road. The last V8/V10/V12 naturally aspirated engines to be manufactured. The last manual gearboxes to be produced. The last cars that we can experience the joy of analogue driving before they evolve into autonomous appliances.

An Extinction Level Event
We are in the midst of an automotive revolution – and the cars that the Fund is targeting are facing an extinction level event. Starting in 2025, production of these last-of-the-line vehicles will cease, and emissions regulation and climate change will ensure they never return in the same form. These performance cars are already made in limited numbers generally, but now with production ceasing, we believe usage of many of these cars in the ensuing years will ensure finite supply of the Fund’s target cars. We can easily see a not-so-distant future where what started out as 250 cars produced globally, could end up being only 10 cars that remain in collectible condition.

The Fund is hedging that increasing scarcity breeds even greater desirability - cars with manual transmissions, the melodious hum of V8/V10/V12 engines, vehicles that embody an era that is rapidly fading into oblivion. Our investment thesis entails seizing these future automotive artworks today, while they are still accessible and before the market truly comprehends the extent of their rarity.

Democratising Automotive Investment
What's truly remarkable is that one doesn't need to be a car aficionado, possess extensive automotive knowledge or even need to be a multi-millionaire to comprehend and profit from our investment thesis. At CHROME TEMPLE Investments, we offer a unique opportunity to invest in a future where passion converges with financial gain—a realm where every car tells a story, and every investment fuels a legacy.


Continue Reading:
The Fund Intro 00: Genesis
The Fund Intro 01: Objective
The Fund Intro 03: Acquisition Strategy
The Fund Intro 04: Fund Structure
The Fund Intro 05: Governance & Oversight
The Fund Intro 06: Information Memorandum

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