Nearly one in ten adults are termed ‘magpie’ investors. According to recent research*, these individuals invest in luxury items in the hope of seeing an increase in value and attractive returns.
The favoured items to purchase include watches, jewellery, collectibles, art, wine, whisky, classic cars and high-end accessories like clothes and handbags. Jewellery came top of the list, with almost half (46%) investing in it with the expectation of appreciation in value.
How much are people investing?
On average, these magpie investors have allocated over £40,000 each to luxury items. From 1,000 people surveyed, the trend looks set to continue as nearly half (47%) of these investors plan to increase their investment in luxury items over the next five years. Specifically, more than one in eight (13%) intend to dramatically increase their investment in such assets. Meanwhile, around a third (34%) expect their investment levels to remain steady, and 9% foresee a decrease.
What are the risks?
The appeal of luxury investments lies in their potential for high returns and the enjoyment of owning prestigious items. However, it can be a higher-risk approach; magpie investors need to ensure they are considering the overall balance of their portfolio, the illiquid nature of luxury investments and the risks associated with investing in non-traditional assets.
Investors can access funds that invest in tangible assets as a more liquid way of gaining exposure to such markets.
We can help to ensure you have a well-rounded and resilient investment strategy.
*Investec, 2024
You can see more of the research here.
The value of pensions and investments and the income they produce can fall as well as rise. You may get back less than you invested.
Approver Quilter Financial Services Limited & Quilter Mortgage Planning Limited. 16/07/2024
