Whisk the sherry, soy sauce, peanut oil, and ginger together in a mixing bowl until evenly blended. Cut the duck breast into 16 pieces and place into the marinade along with the water chestnuts; toss to coat. Set aside to marinate at room temperature for 1 hour.

Preheat the oven's broiler and set the oven rack about 6 inches from the heat source.

Drain the marinade from the duck meat and discard. Place a duck piece onto a water chestnut, and wrap with half a bacon slice. Secure with a toothpick, and place onto a broiler pan. Repeat with remaining ingredients.

Broil until the bacon is just crisp, about 10 minutes, turning once.