The Alternative Investor

Beware of Limited Edition Collectibles

2012-02-05T10:38:00.000-08:00

You may have read my recent post covering a recent newspaper article on one man’s Action Man Collection. If it is your intention to invest in collectibles like this, you should spend some time researching which items are worth buying, as not all items will actually have an investment value. So today, I have a word of warning.

Some manufacturers will market what they’re selling as ‘limited edition’ collectables. This should set alarm bells ringing the moment you see the phrase! It’s often little more than a promotional ploy to encourage sales.

Just because a manufacturer says something is a ‘limited edition’ item (and, by implication, is valuable and worth having), doesn’t mean it is.

You’ll even see the phrase ‘limited edition’ all over some plastic movie action figures in toyshops – and 100,000s of those are probably being produced. In a strictly legal sense, it may be a ‘limited edition’ but they are limited to so many that they’ll never sell out and will still be being found in backstreet shops’ bargain bins in five or ten years!

A useful tip - the more you see something advertised, the less likely it is to turn into a valuable alternative investment. If big money’s being spent on advertising, the manufacturer has a lot of items to sell!

For more tips and ideas on alternative investments, have a look at The Alternative Investor.

Investing in Your Hobbies and Interests

2012-01-29T10:44:00.000-08:00

You may have noticed that my recent posts carried a common theme. They all covered hobbies and interests. For example: wine, coins, antique and classic cameras and even toys.

The point that I am getting to is that alternative investing should be both profitable and fun – and one of the best ways to achieve both of these goals is to invest in your hobbies and interests.

There really are opportunities everywhere. Whether you like taking photographs, drinking wine, reading timeless classics or watching films, you can probably uncover an alternative investment in your area of interest.

The beauty of investing in your hobbies and interests is that it’s simple to do. All you really have to do is to follow the same golden rules of investing in antiques and collectables. Apply these to your own hobbies and interests and you’re sure to pick some successful alternative investments.

If you’ve had these hobbies and interests for some time, you’ll probably be up to speed already on what’s what – and may well know more than many of the experts. That gives you a head start!

If you want to know more about investing in hobbies and interests (or, to use the correct expression, antiques and collectibles), why not take a look at The Alternative Investor.

Kodak Files For Bankruptcy Protection. Is Now The Time To Invest In Cameras?

2012-01-21T09:50:00.000-08:00

Founded in 1880 by George Eastman, Kodak became one of America’s most notable companies, helping establish the market for camera film and then dominating the field. But it has suffered from a variety of problems over the last four decades and this week Kodak filed for bankruptcy protection.

We all know the name, and for many of us, it was a sad story indeed. But the reporting of this story made me wonder whether this will give rise to an increase in nostalgia driven demand for antique and classic cameras.

Until now, I have always felt that there is not a great deal of money to be made from cameras in the antiques and collectables markets. Maybe now, that will all change? I guess only time will tell. Nothing in life is certain.

If you have an interest in investing in cameras as an alternative investment, you could start by looking at McKeown's Guide to Antique and Classic Cameras.

For more information on this, and other alternative investment ideas, why not take a look at: The Alternative Investor

Investing Profitably In Wine

2012-01-21T09:10:00.000-08:00

Wine is an interest for many people – just think, you could make money from what you enjoy drinking! This is a popular hobby that could be turned easily into another alternative investment opportunity.

Even if you only partake occasionally, it’s worth looking at wine as a possible addition to your alternative investment portfolio. You could start – in addition to getting magazines from newsagents and books from libraries – with a wine tasting. This is a great way to build practical know-how and to meet experts and fellow enthusiasts.

Contact the Association of Wine Educators – this Association will give you contact details of members who organise wine tastings in your area. You could also go on wine-tasting tours which are both informative and fun.

Another website specialising in this area is www.wineinvestment.org

Wine investment is just one of several alternative investments covered in a new guide The Alternative Investor.

Investing In Antiques and Collectibles

2012-01-18T16:40:00.000-08:00

Reading the newspapers this week, it seems that during these uncertain times, the world of alternative investments has gone mad!

Earlier today I mentioned an article in the Sun newspaper (17^th January 2012) reporting coin collecting has become a rising trend. I was so interested in this article that I almost forgot to mention another article in the very same newspaper!

A lovely story was printed about a toy enthusiast, Richard Briggs, who had been collecting Action Man memorabilia for some 12 years. According to the report, he now has an impressive collection of 150 items, many in original packaging, that he plans to sell for £10,000.00.

The report does not mention what he paid for the items, but I would imagine that he paid far less than the £10,000 he aims to bank!

Many collectables like these are linked with the collectors’ childhoods – they are nostalgia-driven. Unfortunately, we do not know whether Mr Briggs will achieve his goals, that will probably be down to whether or not he has his timing right when he comes to sell. As collectors age, and no new collectors come into the market, interest and prices fall away. Timing the sale is therefore just as important as the initial purchase.

Whether or not Mr Briggs has got his timing right and makes a profit now that he has come to sell, it would be fair to guess that his exposure to risk very low as he probably built up his investment with several small one off purchases over a long period time. Not only that he probably had great fun in building his collection!

If you like something, it can be both an investment and a pleasure. If it doesn’t increase in value quite as much as you’d like, you’ll still have had the pleasure of owning it, looking at it, touching it and displaying it makes alternative investments like this a form of investment that you can enjoy!

In the alternative investment world, investments like these are collectively termed as antiques and collectibles. You don’t have to invest in Chippendale furniture to be an investor of antiques!

If you would like to know more about this and other alternative investment ideas, why not visit The Alternative Investor.

"Coins Market Increasing By 10% Per Year"

2012-01-18T15:09:00.000-08:00

I have mentioned coin collecting before (Saturday 19th November 2011), so I couldn’t help but notice when a short article appeared in the Sun newspaper today (Tuesday 17^th January 2012) covering this very issue.

According to the report, Stanley Gibbons, the stamp and coin collecting specialist, has seen interest in rare coins increase five fold since the launch of the service last summer.

Michael Hall, the chief executive of Stanley Gibbons, is reported to have said that the coin market is “very strong” and that it has been “going up by around 10% a year”

You may wish to have a look at Stanley Gibbons website and decide for yourself whether this is the sort of investment that interests you. As with all investments, however, you will need to do your own due diligence.

If you are interested in coin collecting as an alternative investment and want to know more about this subject, why not visit The Alternative Investor.

Land as an Alternative Investment – A Word of Caution!

2012-01-02T11:02:00.000-08:00

As an alternative investor, you may well have been offered land with the potential for development – usually this is promoted as a large area of land split into small individual plots which are then offered for sale with the claim that there will be huge returns if planning permission is obtained for development.

While in some cases these are legitimate investment opportunities, in other cases the land is located in a ‘green belt’ or is otherwise protected from development by planning law.

The FSA (The Financial Services Authority) have expressed concern about the recent rise of “land banking schemes” - some of which are leaving investors with land that they have little or no chance of building on having invested heavily into such schemes from tens of thousands to hundreds of thousands of pounds. This is well covered on the FSAs own website and the Law Society's website.

As I have said, in some cases these will be legitimate investments, however, as with all investments, you must do your due diligence.

If you want to explore other alternative investments, why not take a look at
The Alternative Investor

Until next time

Happy New Year and I wish you well with your investing.

Are You Ready For 2012?

2011-12-28T16:26:00.000-08:00

Well are you?

Between mince pies and Christmas pudding - (I don't know about you but I always seem to have leftovers of both) I am setting my stall for the year ahead. I am looking at my assets and how I can improve on them. I advise that you do the same.

Whether you are a seasoned investor or completely new to the game, you need to know your starting point for the year and what you wish to achieve by the end of the year.

Buy yourself a little pocket notebook. Open this up to show two pages. On the left hand page, write down your assets. I tend to use these headings:

1) Money I Have In Property (Property value)
2) Money I have In Pensions
3) Money I have in Precious Metals (Gold,Silver etc)
4) Money I have in Stocks and Shares
5) Money I have in Business Ventures
6) Money I have in the Bank/ Building Society (Including ISAs, Savings Accounts, Current Account)
7) Other (Ie money owed to you, inheritance, other investments etc)
8) Cash in hand

Add these up and put a total at the bottom of the page.

On the right hand page write down your debts:
1) Credit Cards
2) Loans
3) Bank over drafts
4) Mortgages
5) Hire purchase agreements
6) etc

Add these up and put a total at the bottom of the page.

Turn the page and do the simple sum: Total assets less total debts.

You now have your net worth. (Notice that I do not care a fig for your widescreen telly and your car. These are not assets, they are things you use. - OK, you could sell your car, but what are you going to do? Take a taxi to the supermarket?)

Now. Your mission (should you choose to accept it) is to increase this over the next twelve months. I aim for 20%. What I do is look at each of the assets and break down the mission into small parts. I try to work out how I can increase each of these parts by 20%.

Over the last 12 months, I have succeeded in some and failed in others, but my friends, thats the battle.

I am dusting myself off and getting ready for a New Year.

Raise your glasses - and your notebooks! I wish you a very prosperous year ahead.

Watch What Everyone Else Is Doing.........And Do The Opposite!

2011-12-03T05:00:00.000-08:00

Established investors among you will have seen this kind of statement time and time again. For those of you who are new to investing, you need to embrace this idea.

The best time to invest in a stock is when short-sighted investors over sell and beat down the price to protect their short term positions.

The key, as I have said before, is to look at the fundamentals and the long term outlook. This will mean that you will go against that crowd and you will often be buying when everyone else is selling. You must be bold and you must be patient. You will get your rewards when the market recovers.

This is not true for every form of stock, so you must do your due diligence, but my key point is this: You should try to buy when the market dips, not when it rises. In other words, see what everyone else is doing – and do the opposite.

Alternative Investors Should Diversify

2011-12-01T17:05:00.000-08:00

Sometimes greed, temptation, and lack of knowledge can influence how you invest. It may encourage you to stick to certain investments and avoid others. It is so tempting to stick with what we feel is safe or to stick with what we know.

You might be lucky and invest in something that is HUGELY successful right now. That’s great when the going is good, but the important thing is that you should not get complacent. Your brilliant investment may very suddenly do horribly badly – and wipe you out!

Sticking with what you know is a very good way to get started, but once you have your footing, you must consider diversification. Spread your risks.

Most alternative investors want to play relatively safe and tend to mix up their investments – from low-reward, low-risk through to high-reward, high-risk.

Remember, if you expose yourself to only one market, not only have you increased your risks, you have also potentially limited your opportunity.

Developing an Alternative Investment Strategy

2011-11-29T17:48:00.000-08:00

Before investing for the first time, it is sensible to draw up an alternative investment strategy or a set of guidelines that help ensure that your alternative investment is both wise and profitable.

It is very important to take time to research which alternative investments are available and which of those are currently running a trend. A good method is to follow markets before investing to see how they work. This is called ‘Papertrading’. It is especially advisable to use this method when you’re starting off. In essence, all you will be doing is everything you would expect to do when trading, but without making the physical investment. By monitoring markets this way, it is possible to see how well you would have done.

Once you are ready to invest, either choose a market that you already know - for example a hobby, or choose a market that you can research relatively easily. Some alternative investments perform better than others. Several different possibilities to get you started can be found at The Alternative Investor.

An Introduction to Options and Futures

2011-11-26T08:40:00.000-08:00

Just a short word on options and futures. Options and futures are two, broadly similar ways of profiting from a variety of financial markets and these are often used as part of an alternative investment strategy. With options, you can buy an option to buy or sell a set number of something, typically shares, at a fixed price within a certain time. If prices rise or fall in your favour (so that it would be profitable to buy or sell at that agreed fixed price) you will take up that option. If not, you let your option lapse and will simply be out of pocket for the cost of taking up the option.

With futures, you are committed to buying or selling something, usually shares, at a set price at an agreed future date. Clearly, this is riskier than an option as you are committed to that purchase or sale. Much depends on what happens in the market. You could make a lot, or lose a lot. This is a highly geared investment – the risks are high but so are the potential rewards.

If you are interested in options and futures and want to know more about this and other alternative investments, visit www.alternative-investor.co.uk

Has Time Been Called on Property Investment?

2011-11-22T16:59:00.000-08:00

At the time of writing, property prices continue to fall, and we are warned that there is more to come. Banks are not lending and people cannot raise the deposits. Developers are not building as they cannot be sure that they will be able to sell their developments. Now the Government is talking about stepping in with government backed 95% mortgages. The property market seems to be in a never ending decline.

Right now property may appear as a most unattractive investment strategy. But is it really as bad as the newspapers would want you to believe? Remember the fundamentals:

Everybody needs somewhere to live.
The UK population continues to grow (By 470,000 between 2009 and 2010 according to the Office for National Statistics)
If builders are not building demand for housing increases as supply decreases

Property isn't just about capital appreciation over so many years, excellent though that usually is. Property can actually be a two-way, profit-making alternative investment. You can let a property during your period of ownership and the rental income from this should cover any borrowings you might have on it, and perhaps even provide a little extra profit for you. At the same time, property is also that capital investment.

Viewed over time, property is an out-and-out winner - it goes up...and up...and up in value despite sometimes a short-term ‘crash’ (which always look like small corrections on the graph rather than any real crash). Look at any surveys that compare all sorts of investments over, say, 5, 10, 25 years or more. One investment opportunity stands out above all others is property!

Are Your Coins Worth More Than Face Value?

2011-11-19T11:30:00.000-08:00

The price of silver is on the up, having doubled in the last 12 months. This is good news for alternative investors - especially those that have a large coin collection that precedes 1947. Why? because coins minted before 1947 contained real silver, and dealers are now valuing this coins at nearly forty times their face value. A sixpenny bit for example, is now worth a pound, the old shilling coin is now worth £2.

If you have any of these coins in a collection or hidden away in a drawer, you should consider taking them to a dealer rather than delivering them to a bank to exchange them for their face value. If you are interested in becoming an alternative investor in coin collecting, visit www.alternative-investor.co.uk

Diversify and Profit!

2011-11-17T17:38:00.001-08:00

One of the greatest benefits of many alternative investments is their ability to profit in virtually ANY economic environment. Such investments have increased dramatically in popularity over the past 10 years as investors search for alternatives to traditional markets that are currently performing very poorly, with some exposed to the risk of extensive losses. The successful growth of THIS investment class thrives regardless of conditions such as a depressed stock market. Conventional stocks an shares have been challenged since 2008, whereas alternative investors have seen huge growth - such as 14% in green oil plantations and nearly 30% in bamboo plantations. The trick is to spread your wealth across these alternative markets to realise a jaw dropping return. Discover more at www.alternative-investor.co.uk

Welcome to the World of Alternative Investments

2011-10-17T17:28:00.000-07:00

Alternative investments is a term used to encompass everything that can be invested in that doesn't have a determined market that others can invest in. Take for example gold. You can invest in gold, which is valued on the stock exchange, or buy it and fix it to your rafters. Either way, the value will go up or down according to the market. With alternative investments, the market and its description is far less clear. This is because alternative investments rely quite heavily on supply and demand. Take for example Stamp Collections.

The easiest way to explain alternative investments is to say that they are anything that you can invest in that are not commonly held assets that we invest in - such as stocks, shares, cash, property funds or bonds.

When more commonly held assets perform badly, alternatives perform well. Allocating some of your portfolio to alternatives therefore sounds like a balanced decision. In essence, alternative investments tend to favour towards tangible assets. such as rare coins, wine or artworks. Discover more at www.alternative-investor.co.uk

If you are considering alternative investments for the first time, stay tuned to this blog and discover the risks, excitement and interest they sustain in comparison to more conventional markets.