Alternative investment 101: learn to become a collector and profit
How to become a collector and reap the benefits of alternative investment
Benjamin S C Ugoji
There is a saying that money does not grow on trees, however money can grow through taking the advantage of the value inherent in money to create more income streams or asserts. This process takes time and results in the leveraging of your initial capital therefore leading to more income streams. It is not money only money that could be invested in this way. Through out the ages creative imagination and innovative thinking (alternative thinking) men have realised that certain articles can have their worth increased in terms of monetary values attached to them with passage of time.
This is the basis of alternative investment. In his book Investment made easy: How to make more of your money; Jim Slater said:
“You do not have to be wealthy to start a collection.”
The aim of this article is to motivate you the reader to see possibilities in alternative investment and to begin to consider the options open to invest in this income stream for your enjoyment.
What can you collect?
There was recent news in the newspapers and the television about how Chinaware was sold for millions of pounds in an auction. The story had it that the siblings were clearing an apartment and stumbled into this pottery piece and decided to take it to the auction. The outcome of this exercise shocked the auctioneers as well as the experts in the field of these collectables. Who knows what will sell after all; according to Jim Slater, at the auction; ‘It takes two to tango.’
Since there is no hard or fast rule it is possible to look at what worked well in the past as well the motivation of the collector probably for his/her own enjoyment.
You might decide to collect anything from vintage radios to old pens, dolls, Dinky toys, cigarette cards, old books, or matchboxes.
The urge to collect can be driven by nostalgia or scarcity. Another factor that could decide thing to collect are price range that appeal to you as well as capture the style of a generation. For example a Texas instrument calculator manufactured at the inception of the company will obsolete and lack form in terms of atheistic and design. But such a piece, kept in its original package, would be worth a small fortune.
In 1993, for example, a 1934 Bakelite wireless surprised everyone by fetching £17, 500. Imagine how much that amount is worth the present day. As you can see time, knowledge and patience is everything in any form of investment.
Painting and antiques are very valuable items of collection. Who would have believed that a Hollywood poster of Phantom of the Opera would have an estimated sale of $20,000-$30,000 and that a selection of toy dolls would sell at prices ranging up to £20,000 each? Collections of old comics or Dinky toys can become exceedingly valuable.
Other items for collection which are within rich of anyone – poor or rich are watercolours and prints, coins, rare books, stamps, cigarettes cards and memorabilia are all within reach of most people. Hence you can start collecting.
It is thought that inflation, coupled with shortage of supply due to museum purchasing, has increased the prices of many collectable therefore fuelling the demand and the increased yield as a revenue stream.
The main objective for nay collector according to Jim is to have fun, and to enjoy the chase and the pleasure of owning a worthwhile collection; which could become part of the collector’s net personal wealth.
Copyright © 2011Benjamin S C Ugoji