Today’s guest post comes from David Webb – a business consultant from Sydney and regular contributor on BizzmarkBlog. Since I’ve been talking a lot about stock trading recently, these alternative investment strategies provide a great counterpoint.
Stock market trading is often misrepresented as glorified gambling, which couldn’t be further from the truth. The thing with stocks is that they require a ton of attention. They can bring lots of money to the table for you, but will take up lots of time in return. Alternatively, if you invest a lot and spend little time dealing with the stock exchange, chances are you’ll be looking at a financial loss.
Dedication isn’t the main issue here. Even if investors are 100% focused, things can move really fast on the market, and turn their pockets inside out in a matter of hours.
So how does one safely invest and retain value in the process?
Why People Implement Alternative Investment Strategies
Now, with the uprising of modern trading options (cryptocurrencies), the world of trading has been changed substantially. A very risky, yet exciting endeavor, cryptocurrencies aren’t for everyone and definitely aren’t completely safe investments.
Well, it was high time we learned from the rich.
Decades back, traditional, yet alternative investments were very popular among ridiculously wealthy investors, who didn’t want to bother with high-risk options that could land them with either a disastrous failure or a blistering success – they already owned a lot of money and wanted to find safe, fun, and engaging ways to invest in order to retain their riches.
These alternative investments, in fact, tend to pay off in the digital age. They do require large amounts of money and are more liquid, but they are lucrative too, and not without benefits of their own.
1. Fine Wines
This is the least risky of all the featured investment options, and it features a steady return of points at around 10%. Now, although it’s relatively safe, investing into fine wines requires knowledge and research. As prices of certain wines not only vary hugely amongst each other, but they vary from year to year, based on the supply-demand model.
As a rule of thumb, fine wine collectors are incredibly choosy.
This means that in order to get into fine wines investing, you’ll need to stay on top of things. Of course, the digital age has managed to make the entire process a whole lot easier as there are a lot of websites that can help the user seamlessly track wine prices.
The downside to fine wine investing is that you’ll have to invest in vast quantities of wine in order to make a solid return. Plus you’ll need to cash out more for wine storage with a temperature controlled environment. Fine wines are a steady, safe, yet demanding investment option.
2. Rare Art
Firstly, the main reason for rare art being a solid investment: the price variations in this market don’t reflect the state of traditional stocks and bonds highs and lows.
That being said, rare and fine art isn’t really recession-proof, as much as its market experiences its own shifts in price. Essentially, it has a mind of its own in the market. This makes investing into rare art a bit risky at times. Despite the fact that the fine art experienced a boom in the 80s, completely unrelated to the world’s financial status, it wasn’t able to escape the financial crisis of 2008.
In the digital age, things are a bit easier.
Most experts will advise you to start with at least $10,000, which is quite a sum to merely get into something, but a number of art pieces can be found at prices ranging from $100 to $30,000. Owing to the digital age, almost everyone can afford to invest into rare and fine art!
Owning rare coinage is nothing like actually using them for investment purposes. There are two particular types of coins worth investing in and they are both unique in their own way.
First, there are bullion coins. Minted by governments, these coins are generally made of gold and aren’t collectible – their value isn’t based on rarity. Bullion coins can be bought for a price similar to that of regular gold via gold dealers.
On the other hand, there are collectible rare coins, which aren’t valued for their weight in terms of the precious metal they’re made out of. They are valued for something much more lucrative: collectibility.
Essentially, coins such as Walking Liberty dollars and Buffalo Nickels claim their price based on rarity and condition. If a coin is rare and heavily-worn, you might get paid. If a coin isn’t all that rare, but is in great condition, you will get paid something. However, a mint-condition rare coin is valued highly on the market, and as such, is the perfect coinage investment.
Finding a reputable dealer to inspect the coin(s) for you is of utmost importance. If they claim that your coin is a legitimate money maker and give you a certificate of authenticity, you can rest assured that you’re sitting on a lot of money.
Regardless of the type of alternative investment strategy, you need to make sure that you are and remain well-informed. Fine wines, rare art, and valuable coins all require research and dedication.
About the Author
David Webb is a Sydney-based business consultant, online marketing analyst, and writer. With six years of experience and a degree in online business strategies, he is driven to help people better understand this new digital age. In his free time, David enjoys writing, traveling, basketball, and an occasional night out with his friends. You can connect with David on Facebook or Twitter.