The familiar question often investors face is: Stocks or bonds? The answer, unsurprisingly, is often wrong. Guess why? Because it was the wrong question to ask in the first place.
The stock market has always been risky way and is more so today, as the world braces for an impending recession. In times like these, even bonds carry a high risk. But all is not lost. All you need to do is think outside the box.
To avoid the perils of a tumultuous market, and to still keep your money safe, here are some alternative investments.
Are you a car enthusiast? If so, it may be time to put more money into this “hobby.” When you invest in “classic” cars you are getting the best of both worlds. Not only is this a lot of fun, but you are putting your money into an investment that is safer than the stock market.
It’s important to note, however, that not all cars are considered classics. Just like any other type of investment, you need to do your homework. If you don’t, you could end up buying a car that depreciates in value as opposed to growing over the long term.
Just like cars, many people (men in particular) love sports. From soccer to basketball to cycling, among others, there is a sport that probably gets your adrenalin flowing. Investing in sports memorabilia is easier today than ever before. Not only are there many outlets for purchasing memorabilia, but there are several well known services that authenticate these souvenirs. So it is easy to locate a large inventory of memorabilia and make a confident purchase. An astute investment linked to a sports star or team could soar in the future.
Works of Art
Some pieces of ‘art’ are only worth a few dollars. On the other hand, some paintings and other creations can be sold for millions. Many pieces of art have the potential to increase in value as the years go by. Just imagine what an early piece of Banksy’s or Hirst’s work would be worth today!
There are many types of fine art to consider, with some of the most popular including paintings, giclées, sculptures, posters and prints. Buying art for your home is an emotional decision – you want to get something that looks good and shows off your tastes. Investing, however, should not be based on your emotions. Instead, focus on the pieces that are best for you from a financial point of view. Also, make sure you browse the market and thoroughly research any piece before buying anything.
Is wine a good investment? It is a question that pops up time and again, probably without a conclusive answer.
Still, if you are a wine connoisseur or somebody who is looking for an alternative investment, this is something to consider. Vintage wine is in high demand, particularly in the rising Asian economies, but supply is limited. Hence, its value appreciates. Even when the stock market resembles a roller coaster ride, those who invest in wine generally find things to be quite steady.
Although wine investors have every right to be wine drinkers, it is not quite necessary. Even if you don’t know the difference between Burgundy and Bordeaux, wine can be a great alternative investment so long as you take adequate care. Make sure you have access to a temperature-controlled storage facility to keep your investment in perfect condition. Alternatively, you can invest into a managed wine investment fund, which, for many, is the easier route to take.
In the current Australian market, real estate may not be considered a good investment at all. However, investing in bricks and mortar is definitely something to consider, especially if you cast your net further to developing countries like Brazil, China and India where property still appreciates. If you have cash reserves to invest, perhaps you would be interested in purchasing one of the many cheap American foreclosed properties on the market and building a rental income from them. Regardless of where you choose to invest, you should realise that a smart investment in real estate is a decision that can benefit you now and well into the future. However, learn more about real estate markets in different parts of the world before investing.