Investing outside the box is becoming more and more popular as many people are now seeking ways to seek other avenues to grow their money. There are many reasons for this trend of participating in alternative investments. One of the main reasons why people do this is because traditional investment avenues seem to be under performing with the current global political climate.
Here are several out-of-the-box investments that can be lucrative given the proper information and guidance from a recognized expert:
- Tax lien certificates
There is an alternative investment, which is in an obscure corner of the real estate market, that could potentially provide good returns for investors. Tax liens are a type of investment that investors purchase in an auction. They pay the amount of taxes owed by a property owner who failed to pay. Since they have the right to do so, the municipality has foreclosed this property and has sold its tax lien. Investors who have purchased the taxes have the right to collect back that money plus an interest payment from the property owner. The interest rate ranges from 5% upwards. The property owner is allowed to pay the taxes plus interest within a pre-determined period, usually six months to three years. If the property owner is unable to pay, the lienholder or investor has the right to take ownership of the property.
- Memorabilia and collectibles
There is a vast memorabilia market. It is a multi-million-dollar business. The most popular trading happens in auction houses, internet outlets, and specialty dealers. An investor should buy with one thing in mind: to resell it for a higher price. Investing in memorabilia and collectibles can yield huge returns because there is a growing demand for it and just a limited supply in the market.
Not all collectibles are worth investing in. Sometimes what people believe as valuable in the future ends up completely worthless as interests change. There are certain valuable collectibles and memorabilia that prove to be worth investing in, such as childhood toys, pop memorabilia, Star Wars memorabilia, vintage fashion, big names in sports and entertainment, and Chinese and Japanese ceramics. When in doubt, just refer to four major categories: Music, Movies, Royalty, and Sports.
Out of all the out-of-the-box investments that were identified in this article, this must come as a surprise to many readers. Yes, you read it right: you can invest in poker and get your money back in a big way.
Investing in a poker player is not as far-fetched as you might think. Many people, particularly those who are part of the online poker community, have known about this for years.
A poker player investment commonly happens during big buy-in tournaments when a player cannot or would not put up the full amount. The player usually needs a huge amount of money. For instance, 888pokers’s World Series of Poker needs a $10,000 buy-in. A poker player can sell action, and an investor will pay the full amount or a certain percentage of the amount. Thus, the investor will also get a percentage of potential winnings.
Any poker player can be invested in, and whatever type of game can be played – whether Omaha high, Texas Holdem or any other games in a poker tournament. The practice of financially backing players in exchange for a percentage of their winnings is known as poker staking. The principle behind staking is that you’re investing your money into something that you think will perform well.
Now you can buy wine both for profit and for pleasure. Since wine ages over time, it is a good investment. There are widely collected and regularly traded wines that enjoy a very quick increase in prices because of growing demand.
In fine wine investment, the proper information is absolutely critical. Since wine investment is not strictly regulated as other investment opportunities, you must remember a few guidelines in order to enjoy future profit in this endeavor.
First, you need to be able to invest in a government-approved storage facility and ensure that insurance is in place in case the wine is stolen or damaged. Then you need to be able to secure stocks of investment-grade wines – usually those that were produced on a “good year.”
- Venture capital
This type of investment is financing startup companies that have possible long-term growth. Although there is a certain amount of risk involved in this investment, there is a huge potential for above-average profits.
During the last few years, start-up companies and ventures in their infancy have increasingly relied on venture capital funding for raising money. Venture capitalists normally get equity in the company. Good investors should be able to identify young businesses that will yield substantial long-term returns. Successful venture capitalists have mastered the art and science of spotting startups that have the potential to make it big, risking their own money by infusing cash into these companies.
In the United States, a venture capitalist must be registered under the Securities and Exchange Commission (SEC) as an accredited investor, which means that they have to meet certain conditions in terms of net worth and yearly income.
However, starting in 2015, even investors who do not meet the SEC requirements were able to invest in new ventures because of crowdfunding regulations. Through equity crowdfunding, investors can invest as little as $2,000 a year. There are venture capital firms that raise money from many sources and invest the collective capital into a startup.
Venture capital funding is a viable asset to consider when you have spare cash and wish to increase your wealth while helping new companies to grow.
It is time to consider putting your money in another form of investment other than the stock market. You may think it is risky to look beyond the stock market for your next investment, but these are legitimate ways to earn money. These are also good ways to diversify one’s portfolio. Before delving into any of these out-of-the-box investments, it is always recommended that you seek the advice of a financial advisor.