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Alternate Assets

We all have at some point of time in our investing life invested in one or more than one of the following products:

All investments can actually be categorized to their simplest form in the following:

  1. Equity ( Shares)
  2. Debt ( Bonds, FD, NSC, PPF etc)
  3. Precious Metals ( Jewelry, Gold coins and bars, Gold ETFs)
  4. Real Estate ( Land, Flats )

But few of us have dabbled in

  1. Commodities ( Tin, Soya bean, wheat, coal, copper….and every thing else under the sun created by god)
  2. Currency markets ( $, yen, pounds, Euros, INR)
  3. Alternate assets.

Let us talk a little bit about what I am calling here Alternate assets:

Typically alternate assets is anything that can not be classified as one of the first 6 things on the list.

Some common examples will be:

  1. Antique coins and other antique objects
  2. Art
  3. Postage stamps
  4. Wine bottles
  5. Old posters, cards memorabilia etc, typically related to a theme e.g. movies, sports etc.

A lot of people have started dabbling in these assets, the logic one gets to hear is that these assets have a negative correlation with Equity and other markets so they provide a good hedge in volatile markets.

So should we go ahead and invest in one or more of these assets?

I am not sure. But given a choice I would like to stay away from most of the alternate assets.

If you are wondering why I can give many reasons and I plan to write about the same in the next blog I plan to write.

Thanks for reading keep watching this space.

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