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Why Consider Alternative Investment Vehicles?

Because apart from the typical investments, there are vastly more opportunities hiding out there and, it's always wise to diversify your investment portfolio.

Provided that you have enough cash to invest and that you already own some real estate, it is great to start investing in alternative vehicles.


Antiques are also considered alternative investments

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Some buy and collect old wines, but almost everyone has a few old coins put away somewhere. And stamps are not just for kids! Don't believe that your old books are just "throw away dust-magnets", nor might your old furniture be.

Who Turns to Alternative Investments?

Usually the high net worth individuals (you may say, "the rich"). According to a Merrill Lynch/Cap Gemini Ernst & Young World Wealth Report 2003, based on 2002 data, approximately 10 % of these people actually hold their wealth in alternative investments.

In small amounts by making modest financial sacrifices, even the middle class and those who have modest income can invest in alternative vehicles as well.

The Risk With Alternative Investments is Different

Typically stocks, bonds, treasuries, futures and options contracts carry tremendous risks. It's easy to lose on the forex market and some stocks might prove to be low yield-bringing assets. But, tangible assets (included in the "alternatives" category) tend to be more stable and many of them can generate huge long-term profits! Although, there are other (specific) risks involved in their case as well..

Antiques, artwork, coins, but overall rare objects that have aesthetical or cultural value may prove great investments in the long run.

The prices of alternative investments are often negotiated. Appraisal might require qualified professionals and proper documentation (especially if it's about antiques and collectibles).

The volatility of antique objects' price is very low (and the overall value tends to increase over time), whilst from the point of view of market price, the precious metals and commodities in general (which are also alternative investments) can be quite volatile (for example, silver is characterized by dynamical price oscillations).

The risks regarding the sale of many of these is raher high. Of course, the process differs according to the category of the investment.
For instance: it will be easier to sell an investment gold bar to a dealer, but finding a buyer who'd be willing to pay for an antique or a stamp will be require a much higher effort.

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