Why are investors looking for alternative asset classes including art?

Investment assets are seldom treated as objects of intense or hardcore desire. They are mostly considered as mere means to drawing good returns. However, these assets do offer a dual benefit – not just by accruing a reasonable return on their investments to the owners but also a lot of satisfaction and joy by virtue of pride in ownership. Such investments are referred to as passion investments.

What are the investment types/ avenues that one can consider? Various investments would come under this interesting category denoted as passion investment A broad list of it can include investments in works of art, jewelry, collectibles, antiques, watches, wine, sports clubs, luxury automobiles, luxury yachts, music, and performing arts.

It’s not merely about absolute returns. The major goal behind such types of investments is not just monetary gains. While factors like risk-reward ratio and scope for return play a part in these peculiar investment modes, the deciding factor is more often than not preference and inclination of each individual investor based on his or her tastes for owning and taking an active part in the compilation and savoring of the offbeat asset itself.

Interestingly though, the aspect of trying to fulfill aesthetic aspirations yet to become a reality or trying to relive the experience through direct or indirect participation is also there. This mostly holds true in cases where high net worth (HNI) investors spend sizable amount of money on sports clubs’ ownership. It could perhaps be a liking for the sport or the fact that they were not in a position to pursue it in the past. Collecting the items create a sense of active participation and latent satisfaction.

Why are people looking for alternative asset classes? Falling investment yields in most mainstream asset classes including equity and increased market volatility are prompting investors to look for other unconventional investment opportunities that also bring a tangible joy of ownership.