In this week’s look at the collectibles market Gary Kleyn examines security concerns.
TRADITIONAL investment markets may be down but in the collecting business the opposite seems to be true.
Dealers and investors say times have never been better in the collectibles market.
Far from seeing a $20,000 investment in coins or art as a risky proposition, many investors are, in the light of the 25 per cent decline in world equity markets and general unease, seeing it as an important safeguard.
According to specialists in the collectible industry, even retirement income is at the mercy of world markets.
Rainbow Rarities’ Dick Pot said the portability of collectibles was an important aspect playing on the minds of new entrants into the collecting market.
If the international situation deteriorates further, people want to be able to carry something of value on them that can be quickly traded, he said. Mr Pot said he believed shares or property did not provide that level of surety.
The Rare Coin Company specialist Rob Jackman agrees that a percentage of an investment should include diversification into collectibles, including coins.
“Some of the world’s largest investment houses include a holding of rare coins for client portfolios and here in Australia we are seeing that same trend emerging,” Mr Jackman said.
“A small fortune in rare coins can be easily concealed in something the size of a matchbox if necessary. Try doing that with property.”
Portability, ease of liquidity, the ability to sell only a portion, limited availability and the ability for the investment to be included in a pensioner’s capital asset allowance without affecting the pension are seen by investors as further proof of the security offered by the investment class.
Mr Jackman said other forms of investment such as bonds, rents interest and dividends were taxable while being held, whereas fine antiques or art, investment coins and banknotes did not produce a taxable profit until sold and didn’t incur any management fees while being held.
