Which alternative investments are the most popular?

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Do you hold alternative investments, if so which of these have you found to be the most beneficial in helping meet your investment objectives?

Crypto

Whilst I dont own it yet, hopefully Real Estate in 1-2 Years

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I usually have most of my wealth invested in real estate that is cash-flow positive.
Whilst it certainly takes a lot of research to find houses that are cash-flow positive (meaning the rent will cover all of the expenses and the mortgage repayment) and still have a decent opportunity for capital growth, the results can be very rewarding. This has been the asset class I have used to accumulate the majority of my wealth.

I also have some money invested in cryptocurrencies (around 0.5% of my portfolio), but I consider this to be very speculative, despite being in 100’s of percent profit.

I would like to invest in Gold/Silver/Copper, but the cost/hassle of storing it has kept me from doing it so far.

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Thanks for sharing @Tony , I’ve been hearing about gold as a hedge against inflation quite a bit lately. I may well look into gold ETFS.

Has anyone else considered gold ETFs?

I prefer gold miners more rather than Gold ETF’s . NST and EVN pay dividends too and are two good ones imo . They do move up and own a lot but if you lock them in a bottom draw for 5 years you get 20% plus growth as well .

20% plus per year , not for the 5 years of course :slight_smile:

I believe that the tax treatment of direct gold holdings is quite inefficient in New Zealand. Gains will be taxed at your income tax rate at the time of sale.

Having said which, i hold some physical gold in storage with NZ vault. I dont intend to sell it really, see it as a core long term holding so i didnt mind the tax issue. PMGOLD is the perth mint ETF which would be easier to trade into and out of, and result in lower storage costs.

Buying gold miners listed in australia would be the most obvious way to go about having gold exposure in a tax efficient way for NZ resident tax payers. I hold shares in Newcrest in Australia, and a Russian miner ticker PLZL listed in London. The reason i chose these 2 is that they have low cost of production (very low in the case of PLZL), and 2 of the longest mine life remaining of any miners in the world - both around 25 years - where as many miners only have 5-10 years of reserves so may have to do expensive M&A to keep producing. This means IMO they’re more on the stable and steady end of miners. They’d both currently make money with gold at $1100 although newcrest’s cost of production has trended up over time.

Polyus pays around 3% dividends, and is likely to become the largest, lowest cost miner in the world within about 8 years. Presently it’s under-represented in the gold ETFs, so should have a tail wind of bid from those ETFs buying it up. Russia risk obviously. Sven carlin mentioned both newcrest and polyus in his most recent video on gold miners

I viewed holding the gold miners as a way to achieve gold exposure at a lower % of the total portfolio than holding physical gold. Miners are leveraged to the price, ie if the gold price moves 1x, the miners often move 3 or 4x. So, (with some caveats) 1/3 or 1/4 of the exposure to a miner should probably create the same effect within the portolio as a larger direct exposure to the metal.

i have about 4% of my liquid investment assets (ie not including the house i live in in my investments) in physical gold, and a further 1% in gold miners

*None of this is financial advice. I am not a financial professional and the idiot decisions i make for myself may not be suitable for other people’s circumstances

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Does anyone here have any experience investing into any of the agricultural / horticultural private equity type stuff that you can find on Syndex? Any good or bad experiences? Insights?

Fees is the thing that i’m trying to be most careful with keeping an eye on. With myfarm syndicates, it seems like you can write off about 10% of your money when you put it in as being sucked out in fees over the first 5 or so years. Having said which, i can’t afford to buy and run a farm, and losing 10% to fees over 5 years doesn’t seem unreasonable for an asset class i couldnt otherwise access.

the other issue is liquidity. you really have to plan not to sell otherwise youre at the mercy of an extremely thin market. having said which, i’m buying this type of investment in a search for yield that i could re-invest in other areas down the years. Liquidity would only be an issue if my wife left me, so best keep her happy :wink:

I’ve done an investment into a vinyard that’s being leased to misty cove wines. Paying monthly income of about 6.5% of contributed capital. the vinyard is leveraged about 35% - not that aggressive but obviously the returns have some interest rate sensitivity. I did an analysis of the interest rate sensitivity of profits, and if rates on the lending went up from 3% to 6% it still made a decent profit.

I kind of figured if rates double, it’s only because inflation is running hot, so land based assets that produce a soft commodity will probably increase in value as well - but who knows. It’s an alternative asset i’m trying to find some uncorrelated ways to make yield essentially.

I’m looking to have about 10% of my investments in private equity but right now it’s nothing like that much

Plenti, Funding.com.au and Brickx for some regular income.

So far so good, been investing into Plenti since 2016 and while the returns have dropped over time in line with cash rate, overall it has been a good experience.

Started with Funding and Brickx last year chasing bigger returns than Plenti offers (~6.5% vs 4%)

Funding referral link if anyone is interested: Funding.com.au

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U can invest in gold or other metals by ETF, 's, then others hold the actual metals and best the storage cost tho u pay ETF fees

I have looked into that, but most gold ETF’s aren’t actually backed by gold and most of the ones that are aren’t actually allocated and you can’t get physical delivery. Finding an ETF without these problems is possible, but it is just a pain so I prefer to invest my time into other assets (like real-estate, which is also a hard asset and a good hedge against inflation).

ETF Securities has a GOLD ETF which is backd by physical gold stored in a vault, there are a few other ETF companies which do the same for select ETFs.

They are stored in a vault in London. It is unallocated and you can’t ask for physical delivery. PMGOLD does not have these issues from what I can tell, but I haven’t invested the time to understand it properly yet. Presumably I’d also need to travel to Western Australia to get physical delivery (I live in Victoria), so that is a disadvantage, especially with all the COVID travel restrictions in place.

I haventbinvestwsnjn the GOLD ETF, Bn but thinking about it, j don’t have a secure vault so don’t want physical delivery.

What company is the PMGOLD ETF with?

The Perth Mint. According to their website, it is government guaranteed (Perth Mint Gold (ASX) - The Perth Mint, Australia)

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Might look into it

That’s an ETF or just buying physical gold bars?

It is an ETF. It is listed on the ASX under the symbol ‘PMGOLD’

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Cheers will look it up

Crowdfunding. Great access to early stage private companies.

Also, a number of UK listed investment trusts are offering access to fairly young private companies.