"Alternative" Investments

NoviceInvestor1 · 14 April 2015 at 12:57PM

Hello all,

A bit of a random post, but I was keen to hear of anyones experiences of alternative investments, i.e. not bonds, equities, property or P2P which tend to be the usual discussed.

I guess I am particularly interested in experience anyone has had with things like stamps, coins, watches etc.

My interest in this has been prompted by a couple of things. There was an article in the Telegraph Personal Finance section a couple of weeks back about stamps, something I have never had an interest in or any knowledge of (other than what they are!) until reading it. It led me to the website of Stanley Gibbons who specialise in investment grade stamps and funds which have performed strongly compared even to Gold and London Property accordingly to them;

investment.stanleygibbons.com/why-invest-in-stamps/market-comparisons

Has anyone ever dabbled in this? Would love to hear any first hand experience.

Watches I am interested in in general, and am trying to convince myself my next purchase can be seen as an investment and thus entered into my spreadsheet of assets instead of my spreadsheet of costs

There are certain models which are worth as much/more 15-20 years than they cost brand new now, and presumably they didn't cost the same brand new 15-20 years ago as they do now. Rolex for example tend to increase their prices by 7% or so p/annum. Don't get me wrong, I don't expect the average Rolex to outperform the FTSE 100 over 20 years, but as a supplement to other investments has anyone had any success in this area at all?

Thanks in advance for any relevant discussion!

paddyrg · 14 April 2015 at 1:25PM

It's a total punt. People 'invested' in Beanie Babies some years ago, the company issued limited edition ones that changed hands for significant money - fashions change and now they're 50p at boot sales.

Watches, stamps, etc have no inherent value beyond what they were originally sold for. Some 'investments' have an increased value by strangling or controlling the market - then they can show 'spectacular' rises for certain asset classes whilst most are worth the same or less than purchase price.

Put it like this, why are these investments 'alternative'? If they were reliable, regular gains, they'd be in pension funds - but they're not, they're hugely speculative and often contrived to appear artificially attractive to reel in inexperienced speculators (can't call them investors, TBH).

Reaper · 14 April 2015 at 1:27PM

If you have a good knowledge of the items in question then you could try it. Particularly if you enjoy owning the products.

However, and this is a big "however", if you do not know anything about stamps/wine/art/ostrich farms of whatever the temptation is to invest your money with an intermediary who promises to handle it all for you. Unfortunately the alternative investment markets are awash with these intermediary scam companies offering high returns. Be very careful.

PS Stanley Gibbons are legit

kidmugsy · 14 April 2015 at 1:42PM

The only alternative that's ever attracted me is ordinary gold sovereigns. But apparently one shouldn't store them in the safety deposit at Hatton Garden.

Borrowedtune · 14 April 2015 at 1:56PM

I have a large-ish collection of rare malt whiskies. I have no plans to open them (well, most of them anyway), and will either sell them one day or pass them onto the kids. Meanwhile the bottles are kept in a cool, dark place.

I've never really thought of the collection as an investment, but I guess that's what it is really. I started initially because I am very interested in whisky, especially the mystique that attaches to defunct distilleries.

steelbru · 14 April 2015 at 2:16PM

I used to collect stamps when I was a teenager, about 35 years ago.

I still have a Stanley Gibbons price catalogue for UK commerative stamps from back then. Rare stamps that were then selling for about £40 are currently worth about £10.
Any stamp issued since decimalisation in 1971 ( apart from a very very small handful ) can be bought for face value.

So, UK stamps have certainly not been a good investment, but maybe they are cheap now, and will cecome a good investment.

No idea about foreign stamps.

Averaged · 14 April 2015 at 5:55PM

I agree that it's mostly a punt unless you're an expert and/or take pleasure in owning the 'alternative' irrespective of its value (or lack of) - wine's my thing, and I have a collection for the fun of collection, rather than in the hope of a profit.

I made a decent bit of money a few years back when some wine I picked up in France at around £30 a bottle was rated 98 by Robert Parker and shot up to around £150 a bottle but that's the exception rather than the rule even if you've got a fairly good idea what you're buying. Plenty of stuff in the cellar is nice to drink but of essentially no value beyond what I paid for it. So I drink it

(sadly I drank quite a lot of Parker's favourite too, which rather reduced the return on investment. It was lovely)

droopsnoot · 14 April 2015 at 5:57PM

I'm sceptical of stuff like this when it's sold as an investment. For example I have some rare records which are worth quite a bit more than I paid for them, but none of them are records that were originally sold as "numbered limited editions" or any kind of collectors edition, they just happened to be sold in very small numbers, or have a misprint or mispressing or whatever. I like the idea of a nice Rolex, and in fact was talking to someone in the pub the other night who seems to do rather well out of trading old watches, but I think I'd need to know a lot more than I do before sticking money in, and I'm not sure that a shop who happen to sell these things is the best place to get the advice from.

JohnRo · 14 April 2015 at 6:36PM

I bought a few motorsport and racing division 1:18 Autoart cars as a semi-investment about 10 years ago, never opened and stuck on a shelf out of the sunlight, they're selling for approx three to four times what I paid for them, last time I looked.

I had a brief look into rare lego sets a while ago but decided I've probably missed the boat on the sort of gains from things like the first edition millenium falcon and death star.

A lot to be said for investing in the right "toys" but it all seems a bit too hit and miss for my liking.

Drp8713 · 14 April 2015 at 6:55PM

Wine has to be the one. Buy a case of something you like from somewhere like www.bbr.com , pay a tenner or so a year to store it properly, it has half a chance it will age well and appreciate in value so you can flog it later.

And if it doesn't, you just get it delivered and get drunk. No lose situation.

NoviceInvestor1 · 14 April 2015 at 8:50PM

Thanks for all the replies, some really interesting comments here. Don't get me wrong, I wasn't about to sell all my funds and buy a load of stamps, this was perhaps more out of curiosity as opposed to something I could see myself doing.

Lego, wine, whiskies - must say I wasn't expecting to read these things but I guess anything that may reduce in supply and maintain or increase in demand could well be worthy of a punt. Interesting.

Perhaps I need to differentiate between an asset and an investment. Buying a watch for example that is still worth its original purchase price in 3 years is a non depreciating asset rather than a true investment I suppose, but as a few have pointed out if you can enjoy having it and not lose money what is the harm.

Thanks again all.

"Alternative" Investments

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