Passion investments—such as stamps, art and cars—have always been popular with the wealthy. But are they sound investments for your clients?
Here at WealthManagement.com, we’ve covered our share of wacky investment ideas—from musical instruments to racehorses. But the problem with any type of investment is that there is no guarantee, and even less so with these non-traditional types. With art, there’s no way to know whether the artist or piece you’re buying is going to become popular and therefore appreciate in value.
In its 2014 Wealth Report, London-based property consultancy Knight Frank tracked the performance of these types of luxury goods. The Knight Frank Luxury Investment Index, a good indicator of how passion investments are performing, was up 8 percent in the last year, 38 percent over the last five years, and 179 percent over the 10-year period.
Here are the top eight passion investments by 10-year performance.
Source: Knight Frank’s Wealth Report 2014