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Wondering whether Grandmother’s old pearls or Uncle Tom’s Hennessy Cognac from 2012 is worth anything?

Look again because according to Knight Frank Luxury Investment Index, the collectibles market has been doing a lot better than property and shares. And realistically, it’s a lot more fun to head to Sotheby’s for a private auction to buy a Sidney Nolan or Rolex Mariner.

So if you have a bit of spare investment cash, why don’t you try investing in fine wines, watches or cars. While it might seem like a frivolous and risky investment, collectibles managed an astounding 41 per cent over the last five years. And even within the last year, managed 5 per cent which is a better result than cash.

But like any investment, you have to look at the trends of what is currently yielding the most return. Over the last 12 months, fine wine now outranks luxury cars and antiques are not considered of much value any longer.

According to a five-year time frame, collectable cars and wines have returned the most yield – the cars have increased 129 per cent while wines have gone up by 55 per cent.

But the findings found Ming vases, which collectors would think would be a safe investment with the rise of wealth in the Chinese market, there were in fact the worst-performing asset last year.

The RBC Capital Markets’ survey of Chinese collectors’ intentions indicate that nationals earning a certain amount invest in watch brands like Cartier, more so than Rolex, Omega and Longines.

Faring well globally is jewellery and the coloured diamond market. So if grandma left you some jewels, it’s not a bad idea to get them valued and see how much they are worth. Particularly the Argyle pink diamond (which is owned by Rio) is a favourite among investors.

 

PROS

+ Collectibles are not correlated to share markets – items like cars and wine have good years

+ Collections can be gifted to charities or family members. Or if you’re lucky enough, you might get some gifts yourself

+ It’s also a lot more fun going through collectibles than it is going through property and share statistics

 

Cons

Standards and quality vary and if you don’t know what you’re looking for, you can be duped into buying fakes or replicas

The liquidity of collectibles is doubtful. So the value of the collectibles is not determined until a buyer is found.