A Perspective on Collectibles as an Investment Alternative
“An important hazard is something called the safe-haven fallacy”
by Bob Stokes
Updated: September 27, 2022
A lot of people over the years have enjoyed stamp or coin collecting -- others have preferred baseball cards, comic books and other items of widespread interest.
Some people buy collectibles out of personal interest and others view them as an investment. Either way, the price tag can be steep.
Herer's a Sept. 20 headline (Marketwatch):
Michael Jordan's 'Last Dance' jersey sells for a record $10.1 million
That sale breaks the record for game-worn sports memorabilia. The jersey was worn by Michael Jordan during the opening game of the 1998 NBA Finals. Another sports item recently sold for even more (Associated Press, August 28):
A mint condition Mickey Mantle baseball card has sold for $12.6 million, blasting into the record books [on August 28] as the most expensive ever paid for a piece of sports memorabilia.
The previous record for a baseball card was $7.25 million for a Honus Wagner card in a private sale just days before the Mickey Mantle card sold.
Some people who read these headlines might consider them signs that sports' and other collectibles are hot investment items -- perhaps alternatives to stocks and bonds -- both of which have been in downtrends.
Indeed, there was this headline back on June 14 (CNN.com):
Where do you put your money in a bear market? Try wine, art and baseball cards
However, consider this warning from our September Elliott Wave Financial Forecast:
Everything is in Place for a Collapse in Collectibles
The publication goes on to say:
An important hazard is something called the safe-haven fallacy. In bear markets, when there seems to be "no place to hide" in conventional financial assets, many fall for the lure of "alternative" assets.
If you buy collectibles for the love of them, consider this quote from Robert Prechter's Last Chance to Conquer the Crash:
If you want to enhance your collection, keep your capital safe, wait until the bottom, and buy up all the items you want at pennies on today's dollar value.
Some prognosticators have recently speculated that a stock market bottom is either "in" or near.
However, you may want to check out our Elliott wave analysis of the major U.S. stock indexes.
The magnitude of this unfolding financial downturn may turn out to be more severe than even some of the staunchest bears expect.
Follow the link below to get our financial forecasts.
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The mainstream financial press would have you believe otherwise. On any given day, they identify news or events that "lead to" the market's action.
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Oh, sure -- a brief, emotional spike may follow a big event. But after a very short time, the established trend continues.
The key is to KNOW THE TREND.
Let our analysts share that information with you. This will put you a big step ahead of those who rely on the financial press for their portfolio decisions.
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In early 2020, the Covid-19 pandemic delivered a "shock like no other" to the global commodities sector. The bearish "fundamental" shoe seemed to fit like a glove. But instead, a 2-year long bull market occurred. Maybe it's time to slip into a new pair of market analysis.