Sports Investing: Orey's golden goals
There's a lot of money to be made from the beautiful game. Deloitte's football money league shows that the top 20 football clubs in the world are set to break the £2 billion ($3.6 billion) income mark in 2005, for example. Germany's GNP is set to grow by €8 billion as a result of hosting the 2006 World Cup, and about 500 advertisers are set to spend €7 billion to enhance the branding of their products. According to VAT reclaims company Lowendal UK, an estimated €15 million will be spent on sponsorship events during the World Cup.
So how about investing in the lucrative sport directly? Orey Group is doing just that. The Portugese family-owned group runs three funds for institutional and high-net-worth investors that have stakes in players in Portuguese clubs Porto, Sporting and Boavista, aiming to profit from club transfers. The three funds have returned 31.74%, 52.68% and –6.64% respectively. Before the end of the year, it hopes to be expanding its reach to football teams in The Netherlands and Germany.
"We co-invest up to 30% in seven to 10 players in each club, with the idea being to make a return on the future sale of those players," explains the funds' manager, Nuno Gonçalves.