Think The Stock Market Is Expensive? Here Are some ‘Alternative’ Investment Ideas
For most investors, it’s best to put your money in a simple three-fund portfolio and move on with your day, however the returns are not what they could be.
But if you have the discipline and the time to do extensive research and due diligence, there are other opportunities out there worth considering. Now’s the time to do a little research into what else might be available. Should you seriously consider investing in assets besides stocks and bonds? Perhaps there are investments that can generate some passive income that are not market related. I’m not suggesting that you skip the stock market and pick one of these. I am suggesting you become aware of these options to see how they might fit with your overall strategy.
Owning rental property isn’t for everybody. Thankfully, it’s not the only way to invest in private real estate. Property bonds, otherwise known as property investment bonds are a means for developers to raise money from investors in the form of a loan. … From an investors’ perspective, the appeal is often the higher-rate fixed annual interest, backed by a certificate and security over the property they are helping to fund.
Investors have the chance to invest in viable real estate projects across Europe. But that’s not all; you can also invest in mortgage loans, as well as corporate finance. Here is a complete list:
- Real Estate – These are projects such as residential, office, retail, and healthcare buildings.
- Mortgage Loans – These loans fall into two categories: first-rate mortgages that are guaranteed by physical assets and those that have personal guarantees.
- Corporate Finance – These are meant to finance business deals through working capital, investment capital or bridge financing.
Bitcoin’s 9,000,000% Rise This Decade Leaves the Skeptics Aghast, it has gone from zero to hero to ‘digital gold’ since 2017
If in the throes of this bull market’s earliest stages of recovery someone told you to forgo stocks, forget commodities, renounce fixed-income assets and buy an unknown digital token, the first of its kind, and watch it grow beyond your wildest dreams, you’d call them crazy, right?
Emerging out of the ashes of the financial crisis, Bitcoin was created as a bypass to the banks and government agencies mired in Wall Street’s greatest calamity in decades. At first, it was slow to break through, muddied by a slew of scandals: fraud, thefts and scams that turned away many and brought closer regulatory scrutiny. But once it burst into the mainstream, it proved to be the decade’s best-performing asset.
The performance over the past 10 years, even with its huge run-up and subsequent mega-crash, leaves all others in the dust. It’s a massive windfall for those who HODL’ed through its ups and downs, even as it continues to provide fodder for get-rich-quick schemes. For some, the never-ending fantasy of continually hitting that payoff still helps to keep Bitcoin’s momentum going.
Investing in gold sometimes gets a negative perception. Precious metals including gold can be a good hedge when investors are uncertain about dollar-based assets. While physical gold doesn’t earn a dividend, it has been a millennia-long vehicle to store value. Rare coins or physical 0.999 fine gold bars can be your best way to hold physical gold.
Another precious metal to consider is silver. The price per ounce is less than gold, which makes it easier to own if you have a tight budget. Also, silver’s price doesn’t move in direct correlation with gold. Gold’s price typically increases first but silver still has room to run.
Years of low-interest rates have made bonds and other fixed-income assets less attractive. If you have a higher appetite for risk, you can invest in peer-to-peer loans. You lend directly to the borrower with these loans and can earn more interest income.
Peer-to-peer lending, also abbreviated as P2P lending, is the practice of lending money to individuals or businesses through online services that match lenders with borrowers. P2P lending can be as safe as you make it. For those new to P2P lending, experts suggest starting conservatively and also diversifying your investments. In other words, don’t lend all your money to one borrower. Instead, hedge your bets by lending just a bit of money to many borrowers
The market for classic cars has done better than collectables like coins and stamps over the past decade and has also beaten the broad stock index. Just as most investments carry fees, so too does owning classic cars. This is tangible personal property and you’ll owe capital gains tax if you sell at a profit. Becoming collector of high-end cars can take a pretty significant investment and comes with not-insignificant carrying costs. As tastes and economics change, what was once worth a king’s ransom could depreciate to a mere princely sum, so choose carefully.
The Vintage Timepiece Market
With an increase in demand from China, India and Russia and new collectors joining the market every day, the value of rare and vintage watches continues to increase every year.
The global interest in collecting watches grew by 8.4% in 2019 which means that more and more collectors are realising the potential that the vintage wristwatch market offers.However, what does this mean for the existing level of supply? Quite simply, vintage timepieces cannot be replicated.
There is a finite supply and the increase in demand has pushed prices even higher. Most collectors look to hold on to some watches indefinitely which mean that these watches are taken out of the global supply for ever. This results in the remaining watches becoming rarer and, ultimately, more valuable.
According to historical data, rare timepieces traditionally increase in value by 5 to 15 percent per annum. Depending on the timepiece, an average vintage watch could double in value in only 5 to 10 years. And, of course, the more rare and prestigious the watch is, the greater the potential return on investment.
And with the added advantage of HMRC deeming this as a wasting asset, its free of capital gains tax to pay, can you really afford not to give this market some of your time?
Your Own Business
Some investors say that investing in your own business can be the best investment. If you’re an entrepreneur, you may start a local or online brand. There are always areas of demand, from Catering service, Website design, Courier service, Online tutoring, Business consulting the list goes on and on!
This idea can require a large amount of upfront cash and time. Although you can earn lifelong income as your business provides value to others.
Clean energy ETFs are exchange-traded funds that invest primarily in alternative energy sources, such as solar, wind, water, geothermal and nuclear. These alternative energy funds typically track the performance of an underlying index comprised of stocks of companies involved in clean and renewable energy sources. A green bond is a bond specifically earmarked to be used for climate and environmental projects. These bonds are typically asset-linked and backed by the issuer’s balance sheet, and are also referred to as climate bonds.
How do bonds work? Those who buy such bonds are, put simply, loaning money to the issuer for a fixed period of time. At the end of that period, the value of the bond is repaid. Investors also receive a pre-determined interest rate (the coupon) – usually paid annually
These are just a handful of the potential alternative investments available to you. Do a little digging and you might find something that piques your interest!