When one looks at different investment options, the most commonly suggested ones include stocks, currency, real estate or bonds. But what if someone is not looking for conventional investments? What if they’re not ready to bear the risk attached to stocks or real estate markets?
They can explore alternative investments — art and collectibles. As an investor, one’s prime goal is to maximize wealth with steady profits, but investing in collectibles offers much more. Here are ten benefits that make investment in collectibles a bright prospect.
Defying inflation: You can call collectibles the rebel category of investment. After all what other form of investment gains value over time above the prevailing inflation rates?
Time and Value: You’ve read about the traditional long-term investments. This is beyond that. With collectibles, the more you wait before selling them off, the more chances there are of an increase in value. Whether you hold on to it for decades or pass it down to your later generations, a collectible will earn you sizeable returns.
They’re Trending: 2015 saw an uptrend for collectibles and experts predicted 2016 to continue with the same. More than halfway through 2016, we feel the experts played their cards right as collectibles continue to sell at record prices.
They’re Global: Don’t think your collectible is attracting the right buyer in your own country? Sell to someone in another as long as they pay you the value you desire. Collectibles are universal; you just need to find the right market.
The Demand: Historical collectibles are quite limited in supply. Most of these end up being bought by museums which makes them rarer. This helps keep the overall demand for them high over a long period of time. Makes the ones you own more valuable, now doesn’t it?
The Treasure Hunt: Ordering stocks or bonds on a computer can be boring. That’s not the case with collectibles. Finding the perfect investment is more of an adventure as you set out to hunt piece after piece in a real world setting.
The Increase in Middle Class: There has been noticeable growth of middle class (higher disposable incomes) in emerging markets. This means that despite of the predicted volatility of these markets in the upcoming years there will be an increase in the number of buyers for collectibles.
Interest Rate Fluctuations? Who cares: Normally when interest rates fluctuate, they tend to impact investment gains. Collectibles are not susceptible to interest rate changes. This means there are fewer chances of decline in investment gains and subsequent reductions in the level of disposable incomes.
Utility: Probably the best thing about investing in collectibles is that you do not need to lock them away unless you want to sell them off. Like a painting can hang in your living room and the wife can wear those heirloom baubles you so fondly collect. It’s an investment you can enjoy.
The bottom line is that collectibles pay off substantial returns. However, investing in collectibles is a long term investment. You need to hold on to them for longer time periods to improve the returns you wish to reap. So if you are looking for regular returns this is not a feasible option for you.