MAJOR BANKS REPORT MOST VALUABLE COLLECTIBLES/HARD ASSETS IN THE WORLD
Posted By: Dr. Vernon Thomas, February 19, 2021
- Gems and Jewelry
- Timepieces / Watches
- Fine Art
- Rare Coins
- Thoroughbred Horses
- Fabergé Eggs
- Classic Cars
- Fine Wines
- Chinese Porcelain
- Stamps
Unlike “paper” assets, all of the above collectibles have intrinsic value and are a tremendous storage of wealth. These assets coexist and complement other financial assets.
COLLECTIBLES/HARD ASSETS FACTS AND FIGURES
Credit, Suisse, Nannette Hechler-Fayd’herbe, Adriano Picinati di Torcello
The motives behind allocating a share of wealth to collectibles are as diverse as the collectors themselves – whether it be social recognition, philanthropy, or collecting for investment purposes and a store of value. Prior to the Covid-19 crisis, the total value of collectibles in private collectors’ hands was estimated to be around USD 1 trillion, with the biggest share of annual sales claimed by fine art, followed by gemstones, watches and jewelry, wines and classic cars.
Collectors and Collectibles/ Hard Assets
It does not necessarily require great wealth to start an interesting collection. But collectibles and wealth have been closely intertwined since antiquity through centuries of collectors and prominent patrons. Today, 26% of the top 200 art collectors as listed by ARTnews are also on the Forbes billionaire list. According to The Attitudes Survey by Knight Frank in their Wealth Analysis, the share of UHNWIs (ultra-high net worth individuals) devoting wealth to luxury Hard Asset Investments averages greater than 10% of total assets. A survey of 55 UHNWIs across various regions conducted by Credit Suisse wealth management services has found that 44% allocate up to 10% of their wealth to collectibles, 31% allocate more than 10%, while only 13% have no exposure at all to collectibles (13% of respondents said they did not know).
Definitions of UHNWIs differ from one source to the next. The Credit Suisse Global Wealth Report defines UHNWIs as individuals with total wealth of more than USD 50 million. However, from a collectibles standpoint, individuals or families with wealth above USD 30 million are a more relevant segment to consider. Based on the Credit Suisse Global Wealth Report 2019, we estimate that people with net worth exceeding USD 30 million accounted for USD 26.3 trillion of global wealth prior to the outbreak of the Covid19 pandemic. By mid-2020, this number is estimated to have increased to USD 27 trillion according to data of the Global Wealth Report 2020.
Conservatively estimated, an approximate share of 6% in Hard Assets would bring the value of collectibles owned by private individuals to greater than USD 2 trillion. Regionally, the USA is not only the main bedrock of private household wealth globally, but also the key market for many collectibles. But Asia, and China in particular, has made important gains over the years in terms of added wealth and will most likely continue to benefit from the global distribution of wealth in 2020, despite the Covid-19 crisis. In the collectibles domain, Asian collectors have also been an important driving force, with an increasing market share of collectible sales across the board.
DIVERSIFICATION
Credit, Suisse, Nannette Hechler-Fayd’herbe, Adriano Picinati di Torcello
When investing in Hard Asset Collectibles one must consider variables like growth, stability and liquidity into the equation as well.
Although Ultra high net worth individuals are averaging between 5 to 10 percent of their total net worth in collectibles and hard assets, this trend has become more and more prevalent with regular investors across the globe. It is not uncommon to find savy investors with 20 – 25% of their total assets in Hard Assets, especially when their asset base is in the 5 million to 25 million range. This is perceived as a Portfolio Redistribution away from Stock Market Volatility into an area that has proven to provide similar returns over the longer term.
Diversification and safety are at the top of every investors mind especially during the covid pandemic, whether you have a billion to invest or a few thousand protecting hard earned capital is leading investors towards tangible assets. Astute Investors are following the Big Moneys lead and are allocating between 5 to 10 percent of their total Net Wealth towards assets such as Colored Diamonds, Gemstones and Colored Diamonds.
For Investment Privacy and Portfolio Protection these are considered among the best Hard Assets to invest in. Investors who are always looking for the best blue chip stocks and best Dividend Stocks should look towards Hard Asset especially when investing during a pandemic.
NATURAL BURMA SAPPHIRES AND BURMA RUBIES
For Untreated Burmese Sapphires (Royal Blue) and Untreated Pigeons Blood Natural Burma Rubies, growth in this area has been fueled by several factors:
- Hedge against the US dollar. Natural Untreated Burmese Sapphires and Rubies can be bought in US dollars and sold in another currency i.e. Euros or Pound Sterling. When combined with complete Privacy of Ownership, purchasers in countries with less political stability value Gemstones for their portability.
- Portability (a very high value in a very small item) and Liquidity.
- Increased demand from International Investors for the best quality.
- Reduction in supply from mining operations in Burma. Most mines with quality Untreated product are producing only limited supply.
- Political and Military instability in Burma has had a dramatic reduction affect on supply.
Untreated Burmese Sapphires and Rubies are known not only for their beauty but for their ability to hold their value over time. They have consistently outperformed other hard asset vehicles and possess liquidity. Sapphires are found in all colors of the rainbow from Green to Orange to Purple and even Salmon Pink. Globally a medium to Dark tone called Royal/Vivid Blue (Grade AAA or AA) with even saturation is best for Investors. A medium to Dark tone Ruby called Pigeons Blood (Grade AAA or AA) with even saturation is the ultimate acquisition for Investors. A general rule of thumb with Burmese Sapphires and Rubies is greater color saturation, deeper tone and No Treatment of any kind will always translate into the best price appreciation and a stone that will hold its value over time
At Phoenix Asset Consortium we only deal in the top 1% of Natural Burmese Sapphire and Rubies. For assistance on how these can add value to your overall investment portfolio, please don’t hesitate to call for assistance.
Tel: 416-679-0580
Fax: 416-679-8355
phoenixassetconsortium.com
