Just a decade ago, accessing basic investment opportunities required working with a broker or advisor and forking out a fee for every transaction. But now things are different. A whole host of apps and platforms make it easy for anyone to buy and sell all kinds of assets (or pieces of them, at least).
It’s important to note that all investments risk the money you put in – and some of these might be even riskier because they are new and unproven. Also, nothing here is intended to be advice on investment, tax or legal matters.
If you’re an eighties or nineties kid, you might know these as things you used to trade in the playground and collect in a cardboard box. Now they have their own online exchange, can be worth serious money, and are increasingly considered a legitimate, viable investment opportunity. Historically, the majority of the $5 billion sports card trading market was made up of cards bought and sold at eBay auctions by enthusiasts. But now, there’s a profusion of blockchain-backed apps that are helping a broader audience make investments in this arena. In 2020, a Mike Trout rookie card sold for $3.9 million at auction. (For the uninformed: Mike Trout is a baseball center fielder for the Los Angeles Angels; rookie cards are the first sports cards issued after an athlete plays in the highest league of their sport; and $3.9 million set a new bar for sports card prices.) Trading card marketplace PWCC created a market index for the investment performance of sports cards over the past decade – and the ‘PWCC 500’ started outperforming the S&P 500 (a highly regarded index of the US stock exchange) in 2015 and continually hit new highs throughout 2020.
Art-buying has become more transparent. A Banksy painting or tape-and-banana installation is no longer available only to millionaires. If you can’t afford an entire work, buy a piece of it via platforms that sell fractional shares for as little as $20. You won’t be able to display the artwork in your home, but you’ll share earnings from any appreciation in value and claim (partial) ownership of blue-chip art by icons like Andy Warhol and Yayoi Kusama. Masterworks – a company that acquires, securitises and stores art for people to invest in – sold Banksy’s ‘Mona Lisa’ for $1.5 million, providing 32% returns to people who bought shares in the piece.
The value of Hermès’ classic Birkin handbag went up by 17% in 2020, outperforming other luxury assets like wine and collectible cars, according to consultancy Knight Frank. Meanwhile, sneaker culture has made millionaires of teenagers buying pairs for tens or hundreds of dollars and ‘flipping’ them for thousands. The sneaker resale market is estimated to be worth $2 billion globally. If you’re not confident in your ability to judge what will have resale value, buy a fractional share in a vetted collectible fashion item instead.
Digital assets (AKA NFTs)
If you want to own a tweet, GIF or video, you can now purchase a non-fungible token (NFT) that represents that piece. NFTs use the blockchain to create a ledger of ownership for any digital asset, meaning it will always be possible to distinguish the ‘real’ digital file from any copies or pirated versions. A recent high-profile NFT sale was the Chris Torres Nyan Cat GIF, which sold for around $580,000.
Saving up for a significant deposit isn’t the only way to invest in real estate. Apps like Fundrise and Cadre make it easy for non-accredited investors (AKA individuals without a ton of wealth) to invest in real-estate funds. And the timeshare has received a 2020s rebrand in the form of fractional ownership of second homes. Several new platforms offer slick and easy ways to buy a slice of a property, and earn a slice of its appreciation value. For example, Pacaso sells shares in multimillion-dollar West Coast holiday homes, finding a set of about eight co-owners to buy each property.
This article was first published in Courier issue 41, June/July 2021. To purchase the issue or become a subscriber, head to our webshop.