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Nick Mason drives the 1937 Auto Union Type D at Goodwood

Classic rock fans recognize Nick Mason as the drummer from Pink Floyd, but classic car enthusiasts know him just as well for his automobile collection and regular column in Octane magazine. Now the musician/car nut is headlining a different kind of group: an investment fund.

Based on the growth in value of some of the top collector cars the past few years, IGA Automobile is putting together a portfolio of historically significant and highly collectible cars for its investors. The new investment fund targets raising $150 million in capital and turning it around over the course of seven years to earn its investors a 15% profit. To get there, IGA is looking at buying cars like Ferrari 250 GTO, Aston Martin DB4 Zagato, Ford GT40, McLaren F1, Shelby Daytona Coupe and Porsche 917 and selling them at a profit.

The fund has solid basis for its financial projections: record prices have been fetched in the past few years by such exemplary automobiles as a 1957 Ferrari 250 Testa Rossa ($12 million), a 1961 Ferrari 250 GT California Spyder ($11 million) and a 1936 Bugatti 57SC Atlantic (~$35 million). Overall, Hagerty's "Cars That Matter" index rates prices for collectible postwar automobiles as having gone up 67% from 2006 to the end of last year, compared to the S&P 500 Index, which dropped 5.9% over the same time period.

[Source: The Detroit News | Image: Mark Thompson/Getty]

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    • 1 Second Ago
      • 4 Years Ago
      This is why the classic car market is getting or is already out of reach for the average car nut. Last week in Scottsdale at the Barrett-Jackson Auction some really fine classics were going for reasonable rates during the week. However when the weekend came look out. Cars were selling for well over 100K. Really? A 69 Boss 302 Mustand for 450K??? Charity or not, that is waaaaay high. With this consortium coming onboard they will keep prices outrageously high in order to recoup the investment. It is like any other commodity I suppose, manipulate the price for your own gain, and everyone else is left out. Well I guess if you have the dough you can afford it......................
        • 4 Years Ago
        There were lots of Mustangs built - but very few 250 GTOs, or DB4 Zagatos.

        Barrett-Jackson is not an accurate market barometer.
      • 4 Years Ago
      Beanie babies.
      • 4 Years Ago
      I love Pink Floyd!
      I saw Roger Waters for the 1st time this past fall!!! Fippin' wicked!

      I still need to read Nick's book which is on loan from a friend, but haven't had time cause I'm a stay at home dad..... help me ;)
      • 4 Years Ago
      geez I love Pink Floyd. I'll never forget seeing Animals at Madison Square Garden in 1977... I don't know anything about investing. If anyone wants to be a patron for an emerging artist, lol...
      • 4 Years Ago
      Oh thank God... I was getting depressed about high prices meaning I'd never own a classic car. Thankfully, the fact that people are setting up a fund to invest in them means that the market has reached its peak and a crash isn't far away.
        • 4 Years Ago
        I'm with you, Doc. I think it's a great idea, but the timing seems highly questionable.

        Another thing that many may be missing is the overall global economic downturn. The USA, Greece, Ireland, and Spain all have massive, unpayable debt. At some point, healthy economies like China and Germany won't be able or willing to bail them out. When all of this starts to happen, many people will lose a lot of wealth. Yes, many of the wealthy will still be wealthy, but the numbers of dollars and investors to profit from will drop noticeably. As it's often been said, "when things go bad, the first thing to go are the toys". A rare Ferrari may suddenly look like a really bad idea as an investment compared to oil or food futures.
        • 4 Years Ago
        Are you kidding me? This can't miss!

        This is such a sure thing that I'm going to buy 3 and get a 5% LTV loan on each one. Oh heck, forget that, I'm going to find a company that will PAY ME at close of escrow.

        You people are fools for passing on a business deal as good as this one.
      • 4 Years Ago
      Just don't forget that well-worn disclaimer:

      "Past performance is not an indicator of possible future profits ..."

      The only area where the collectibles industry may be more rife with corruption than automobiles is in the fine art world ...
        • 4 Years Ago
        Even without corruption, it's there's a lot of substitution available in the market. Ferraris cost too much? Get an Aston Martin. All those cost too much? Get a replica.

        The supply of the original cars is limited, but there are plenty of other things people may decide to buy with their mad money if the prices really climb.
      • 4 Years Ago
      Funny enough, a banker friend and I have been discussing doing this for several years. It's not that original of an idea as there are several art funds out there.

      • 4 Years Ago
      Well shine on you, you crazy diamond.
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