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INVESTMENT: Unorthodox Investments That Could Make You Millions
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Unorthodox Investments That Could Make You Millions

By Michael Dow

BT 201608 070 03 Investment 11664993 155559614145 2The financial movers and shakers on Wall Street are always trying to come up with fancy new ways for investors to play the financial markets. Now admittedly, once someone has managed to grasp enough of concepts, strategies and potential risks that are involved in dabbling with stocks, bonds, ETFs, REITS, commodities futures and the like, it does make it pretty easy for people with even a few dollars to spare to get involved in investing with a few clicks at the keyboard.

Despite what some of the conspiracy theorists say about the financial markets there will always be a need for them. But that does not mean that the aforementioned options are the only way you can accrue big returns on your money. In fact for those of us who are willing to find out where to look and how to get started there are literally thousands, if not tens of thousands of alternative ways by which you can put your hard-earned cash to good use. Making money is just like anything else in life: the more you are able to think outside the box effectively, the higher your chances are of succeeding. This month we will look at just a few of the more unorthodox or uncommon investment opportunities that have made many a small time investors’ early retirement dreams come true.

Not so rare commodities

BT 201608 070 04 Investment 20081114162753336Commodities have staged a decent recovery so far this year but generally speaking they have been a bad investment for a while now. Prices of crude oil and industrial metals have sunk like a lead balloon since the good old days. Gold and silver are not looking particularly attractive either. There are however some commodities that performing very strongly.

Certain niche agricultural commodities in particular are looking great at the moment. Unlike copper for example, which depends largely on how many infrastructure projects are going on in the emerging markets, these are the things that we need to consume regardless of economic circumstances. Over the last year the price of lean hogs, a key source of pork in the United States, has surged by more than 50% in 2014 and demand is still very strong. Soybean meal has also been tipped as a good buy, with a steady price growth and steady demand growth over the last few years. With the world becoming richer and with there being more mouths to feed, the agricultural commodities space is definitely worth a look.

The fast road to financial freedom

BT 201608 070 01 Investment 1967 Ferrari 275 GTB 4 NART SpyderVintage vehicles have become great cash generating assets. According to Bloomberg Markets Magazine, "Classic cars were a huge earner for investors, with a three-year annualized return of 21.0% and a one-year return of 40.7%. The 1954 Mercedes Benz W196 Grand Prix race car fetched a record $29.5 million at a British auction to an unidentified private buyer. The car was used by Formula One driver Juan Manuel Fangio". The article also pointed out that "Ferraris from the 1950s and '60s saw high returns. A 1967 Ferrari GTB NART Spyder went for $27.5 million and several more went for prices between $10 million and $20 million". If you know your cars and if you have the money and parking space then trading some classic motors could be a great way to make some big money.

Niche rental income

BT 201608 070 02 Investment 211801ul3o6l2knge6ztne 0When people think of making money from leasing property it is houses, apartments and condominiums that spring to mind. Although nobody has any doubts that these assets are the way to go if you know what you are doing, there are other ways that you can get rich through rental income. Storage space is a good example. Prices aren’t going up as quickly at the moment but over the last few years this sector has seen double digit annualised growth. You can either invest in storage units yourself or simply park your money in trusted companies like Space Storage Inc., Sovran Self Storage and CubeSmart.

If you own well placed pieces of land in certain countries, which haven’t been built on yet, then it might be worth holding on to it for a few years or even decades and then sell it off down the line for big bucks. Another option is leasing out boats to holidaymakers. During the summer months in the UK some families pay big money to hire out a canal barge for a few days or weeks of floating around the beautiful countryside. Likewise in the beach resorts of the world, there is a demand for water-based property.

Collecting dust but gaining value

BT 201608 070 05 Investment stamps 1289074And of course there are those lovely collectible items that have been sitting in your attic for years when they could be sold on eBay for a small fortune. Prestigious art work is the most obvious one. If you happen to have an eye for this kind of item or you have some fine art lying around in your home then it is well worth getting it valued and selling it at an auction. Like anything that is collected by wealthy people, art has a proven track record of storing value over time and fending off the evil force of inflation.

Collectibles as a whole have performed pretty well over time, which is why many people still bother to collect them in the first place. The age-old cliche of people getting rich off stamp collections has actually proven to be true. According to Stephanie Yang of Bloomberg, "Stamps generally produced gains of 2.6% over one year and 5.4% over three years. However, if you were fortunate enough to have invested in some rare 1800s stamps, your return could have quadrupled. One 1867 9d pale straw stamp had a three-year annualized return of 26%. Another, from 1830, had a three-year return of 23.7%".

There are of course plenty of risks involved when it comes to investing in collectibles. As an investment consultant Tom Brakke points out, "Chasing a hot trend in collectibles is generally not a good idea. As with developments in the financial markets, it is possible that a trend will persist and that you'll make some money, but selling at the right time is a real trick". However, he also argues that "if you have real expertise in a particular area, you can take advantage of the mispricings that exist. It is easier to do that with collectibles than with stocks. If you are immersed in the details of the market and understand how the collectible is priced, you have a chance of spotting some real bargains".


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