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SGAM Global Luxury & Lifestyle Fund

SGAM Global Luxury & Lifestyle Fund is an interesting new product that has just caught my attention. Being the first of its kind open-ended equity fund for the Singapore retail market that invests in premium luxury and lifestyle companies on a global scale, it is unique in the concept. However, no matter how innovative an unit trust is, it is still necessary to evaluate if it is just hype or investing in it is truly a good option.

The gap between the rich and the poor has been widening and the rich are getting much richer. This is evident in the emerging markets of China and India where the middle class is growing rapidly and high net worth individuals are also sky rocketing.

Luxury goods are a favourite with those who are recently affluent, helping to reaffirm their successes, and impressive growth in sales for luxury goods have already been noted. SGAM Global Luxury & Lifestyle Fund further has the advantage that demand for luxury goods are usually price inelastic and profits can be maintained.

SGAM Global Luxury & Lifestyle Fund does not appear to fit in with my investment philosophy at the moment and I think I will give it a miss. But it definitely feels good to be owning a piece of companies selling the luxury goods than be the one contributing to the companies' bottomline. It will be interesting to see how SGAM Global Luxury & Lifestyle Fund performs against the benchmark index in time to come.

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