Alternative investments: Have you ever considered investing in art, gold, or wine?

Does the thought of investing in indices, equities, or futures make you yawn? Don’t worry, you still have a place in the investment world. There are many other options for investments out there that might catch your eye. Some of them are kinds of commodities that you might have heard about in the news — such as art, gold, and wine.

However, before you jump into the market of any of these, what’s important for you to know? Who’s most likely to profit from investing in these? What are the benefits, and what are the risks involved? I have been investing for a few decades now, and I’ve learned a thing or two about these alternative investments. Allow me to share this knowledge with you.

Art: emotions might distract you

While in other markets, such as the stock market, taking actions according to confidential inside-knowledge is forbidden and punishable — in the art market it’s necessary for success. That’s why an investor, who wishes to make a profit in this field, ought to be knowledgeable and experienced. And that takes a while.

Gold: short term vs long term

Keep in mind the collateral expenses that investing in gold includes. In its physical form, gold isn’t an easy commodity to trade, and especially store: The Romanian bank BCR, for example, redeems deposited gold if it’s kept in the bank’s safes. The redeeming price is lower than the purchase price.

These obstacles might cause minor investors to refrain from gold investments. However, if you decide to stick with the gold market, there are other, indirect ways you can do it: You can invest in CFDs, speculate the future value of gold, and make a profit if your assessments are accurate. Otherwise, you can buy shares of gold mining companies. The value of their shares is influenced by the price of gold, naturally. These are viable options for the small investor.

Gold bars
Photo by: Shutterstock

Wine: the entry threshold

The entry threshold into the wine market is about several thousands of dollars or euros, as the price of a collector’s (or investor’s) bottle of wine starts at 500-$600. Storage is also a major issue: Storing wine is a pricey business. The investor needs to pay annual fees for safe storage facilities, not to mention the insurance costs. Don’t bother investing in wine without insurance. For these reasons, the wine market also is challenging for novices.

Starting small

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Angel investor. Real Estate. Fintech

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