Jasmine Birtles
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5 Unusual Investments That Could Beat The Market
Ruby Layram
18th Jun 2024
It goes without saying that the stock market can be a little boring! Let’s face it, no one wants to stare at price charts all day long. If you have a bit of money to spare and fancy putting it in something a bit more interesting, here are 5 unusual investments that could beat the stock market.
Before we delve into what these exciting investments are, it’s important to note that there is no guarantee that you will make money from any of the investments that will be discussed!
This article has been written to open your eyes to alternative investment ideas and shouldn’t be taken as financial advice!
1. Fine wine
Pinot lovers rejoice! Did you know that you can invest in fine wine and potentially make a profit?
And no, I’m not talking about stocking up on your favourite bottles from Sainsbury’s.
Investing in fine wine involves buying vintage, collectible bottles from the secondary market. This is the name given to the market through which investors by assets from other investors.
Most of the assets that we discuss today will be available in this market!
The most reliable places to find investment wine are auction houses. Here, investors place bids on bottles that they would like to add to their portfolio.
The key to making profit long-term is to invest in bottles that are of high quality and high demand You should choose bottles that are produced by reputable producers.
You should also look for bottles that have a good re-sale history. This means that you will be able to sell it to another investor to make a profit when the time comes.
You can store bottles in your own home or store them in a government-bonded warehouse. The latter option would allow you to buy and hold wine without pay VAT.
Not a wine fan? Read our guide on how to invest in Whisky.
2. Handbags
Handbags are one of the most exciting unusual investments (in my opinion) to consider right now!
The luxury handbag market is expected to reach 43.02 billion by 2030 and some of the most sought-after bags see monumental returns.
For example, the Chanel Flap bag is currently sold for 3x the price that it was originally sold for over 10 years ago. If you were lucky enough to buy it when it came out, you would have made a 200% return on your original investment.
Chanel bags aren’t the only luxury handbags that have seen these returns. Hermes, Louis Vuitton, Gucci, and Dior are a few examples of other bags that can be resold for more than their original price.
The main challenge that comes with investing in handbags is finding bags that are authentic. There are thousands of really good fakes circulating the market that trick investors every year. Unfortunately, if you buy one of these fakes, you won’t see a return on your investment.
Always use a reputable merchant and get your bags checked before making an investment.
You should also be careful to choose bags that will stay in fashion. Timeless classics are the best kind of handbags to go for because they will always have demand.
3. Peer-to-peer lending
Wine and handbags are both fairly beginner-friendly (as long as you know what to look for!). But this next unusual investment is a little more advanced.
Peer-to-peer lending is the process of lending your money to individuals and businesses who need extra cash. You can make a profit from interest which is paid by borrowers.
The interest paid can be very high, which makes P2P lending an attractive opportunity. However, it is also very risky.
In the UK, peer-to-peer lending is done through online platforms that are regulated by the Financial Conduct Authority. The risk comes when borrowers aren’t able to repay the loan.
4. Watches
Just like designer handbags, luxury watches can increase in value over time. Rolexes appreciated by around 11.3% between 2022 and 2023 and Patek Phillipe watches have seen their prices go from around £2000 in the 70’s to over £40,000 in 2024!
Luxury watches can be an excellent way to invest whilst adding a few showstoppers to your wardrobe.
To make money investing in watches, you need to know which pieces will appreciate over time. Factors that influence the price of watches include rarity, consumer trends, public opinion of the brand, condition, and whether the timepiece is vintage.
When it comes time to sell your watch, ensure you have it appraised by a reputable expert to get an accurate valuation. Selling through a trusted jeweller or dealer can help you reach a broader audience and secure a better price for your timepiece.
Just like any investment, there is no guarantee that the value of a watch will go up. Trends can change and consumer demand can fluctuate.
5. Art
Art is a popular alternative investment that has been around for centuries. The most expensive painting, Salvator Mundi, was sold for over $450 million at auction in 2017.
Since 1995, contemporary art has seen a 14% annualized price appreciation. Whereas, the S&P500 index has seen a 9.5% annualized price appreciation.
Art can hold its value over time, which makes it an attractive long-term investment opportunity.
However, not all pieces will appreciate. Making money from investing in art requires a good understanding of what makes artwork valuable. It is a good idea to seek expert help before choosing any pieces to buy.
When doing your research, look for pieces that have a good resale history. You should also look out for established artists and pieces that are rare.
Unusual investments are a fun way to diversify your portfolio with assets that aren’t stocks and shares. However, like all investments, investing in alternative assets comes with risk. You should assess your current financial situation before making any decisions.
Are you interested in learning more about investing? Why not sign up to the MoneyMagpie bi-weekly Investing Newsletter? It’s free and you can unsubscribe at any time if you find it isn’t for you.
Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence. When investing your capital is at risk.
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