Over the last few years there has been rapid growth in a new segment of the bond market, commonly referred to as mini bonds. Mini bonds are unlisted company bonds marketed to retail investors. Although they raise relatively small amounts of funds compared to listed retail bonds or equity fund raising and are usually issued by smaller companies, some household names such as John Lewis, Tesco and Ladbrokes have also participated in the market, raising awareness of this new asset class.
Collectibles are often items of personal interest and seen as a hobby, rather than an investment. While they are not traditional financial products, there are many ‘investment grade’ collectibles that can provide diversification, a hedge against inflation, a physical store of wealth and an additional source of returns. In this article, Intelligent Partnership’s Junior Research Analyst, Samantha Goins, covers the benefits and considerations when investing in collectibles, as well as how to mitigate some of the risks.
Gold is the most widely understood precious metal, which for thousands of years has been used as a currency and sign of wealth. Today it is used as a physical store of wealth and safe haven asset by ordinary retail investors, providing diversification and a hedge against inflation. In this article, Intelligent Partnership’s Investment Analyst Luke Jackson covers the benefits and considerations when investing in gold, as well as touching on the different ways for retail investors to access this sector.
Student property is one of the fastest growing alternative investment sectors. It provides a physical store of wealth, a hedge against inflation and regular rental income – in much the same way as well established commercial and residential property. There are many options available in the market for retails investors and it has been a top performing asset in recent years. But investors must understand the fundamentals behind the sector and fully assess the opportunities presented to them.
Farmland has traditionally been the preserve of wealthy families. Recently more institutional investors started accessing farmland for unique diversification. The fundamentals of supply and demand are shifting and the number of retail investment opportunities in this sector has dramatically increased in recent years.
Precious Metals have long been viewed as safe haven assets, providing balance to investment portfolios. Obviously gold is already established as a common retail investment, but silver is now in focus. With its many industrial uses, silver can outperform when economies return to growth as well as providing essential hedging in downturns.
In July 2013, the FCA issued proceedings against Capital Alternatives and 14 other parties alleging that two investment schemes, African Land and Reforestation Projects (known as Capital Carbon Credits), were operating illegally as collective investment schemes (CIS). Operating a CIS in the UK without authorisation is a criminal offence. Capital Alternatives argued that the schemes were direct purchases of property and therefore not collectives.
The Achilles heel of alternative investments has always been the lack of liquidity. Yes, they offer un-correlated returns, additional yield, higher returns and more excitement – but they often are risky and the lack of liquidity compounds that risk because it makes exiting the investment difficult. The benefits of liquidity are pretty obvious: you can buy and sell more easily, more frequently and more cheaply.
Forestry has long been viewed as a store of wealth for the super-rich, but is it something that is ever suitable for ordinary investors? Intelligent Partnership’s Luke Jackson discusses the different types of forestry investment available, who they might be suitable for, and what role they play in a portfolio.
High-profile failures have resulted in intense scrutiny and tighter controls, but there is now a large amount of optimism as to what the future may hold. A good awareness of how to assess the risks can help investors and their advisers seek opportunities which have the potential to diversify a portfolio and provide uncorrelated returns.