‘Alternative investments’: from children’s books to memorabilia
by Alexander Beard, on Aug 30, 2016 2:31:42 PM
If you’ve got some spare cash left over from more traditional, structured investments, then you could follow in the footsteps of the growing number of people investing in collectibles. As well as providing something physical to enjoy and look after in a way that other investments can’t, many collectible items can increase in value as time goes on. Even if you’ve no particular interest in the ‘alternative investment’ market, it can be interesting to look at where people are putting their money and what success they’ve had.
One particular area of investment that many may not think of themselves is first edition children’s books. Unsurprisingly, older books are those which hold the greatest value, such as a first edition of Curious George, published in 1941 by Hans Augusto and Margret Rey, which is now worth around £19,000. However, many newer children’s books are growing in value, with Julia Donaldson’s The Gruffalo from 1999 one of the best investments. The value of a first edition of the book is now £113, a rise of 11.6% per year since 2006.
First editions of Harry Potter And The Philosopher’s Stone are also sought after, over and above any of the other books in the series: the highest price paid on AbeBooks.com for a copy is £20,000. Before you start digging through your youngster’s bookshelf, however, be aware that several specific criteria (including a misprint on page 53) have to be satisfied to denote a true first edition, and the value is very much linked to the condition of the book.
Those who have already retired are also choosing to enter the alternative investment market, focusing on a wide range of collectibles. Not only does this allow the older generation to indulge in some welcome nostalgia, it also provides an enjoyable way to invest without having to sacrifice the potential of a healthy return on the money they put in. The top 250 investment-grade British stamps have on average seen their value increase by 11.78% every year between 2004 and 2014, whilst the top 200 investment-grade English coins fared even better from 2005 to 2015 meanwhile, with growth of 12.75% per year.
As with any investment, putting your money in collectibles has risks as well as rewards. It could be a while before you see any return on your investment, and as trends in the collectibles markets change the value of anything you buy has the potential to go down as well as up. Many people who opt for this form of investment do it for passion and enjoyment more than sizeable monetary gain, as well as having something tangible of value to leave to their family when they’re gone. If that sounds like you, maybe putting some money into collectibles is worth considering.