Let Finance Crisis "Drive you to Drink"

Let finance crisis 'drive you to drink'

Whisky
Why you should invest: The value of whisky has not dropped in the last 720 years since they started making it in Ireland, said Mr Bill Hedman, managing director of venture capitalist firm Delemere Enterprises, which has its own distillery in Australia.
'At the very worst, if your investment crashes, you can go and get drunk on very good whisky, instead of holding on to a worthless piece of paper,' he added.
How to invest: You can buy whisky by the bottle or by the barrel.
What you should consider: The taste, rarity and reputation of the whisky, based on reviews by critics.
Investor tips: General manager of La Maison du Whisky Emmanuel Dron, who also invests in whisky, advises investors to buy only award-winning or limited-edition whiskies if they wish to get a good return on their investment.
Some bottles Mr Dron thinks are good buys - if you can still get your hands on one - are the limited-edition Laphroaig single-malt scotch whisky from 1974, which had only 910 bottles released worldwide.
The whisky won the award for the best whisky in the world in 2003.
A bottle cost $700 two years ago, but the price has shot up to $2,500 and will 'carry on increasing', Mr Dron said.
How much you need: If you are buying whisky by the bottle, the cheapest ones start at $80. If you are buying by the barrel, you need to set aside $30,000, which would include insurance, storage and bottling costs.
Wine
Why you should invest: Fine wine has been known to outperform stocks for the last three to five years, said Mr Andrew Bassett, trading director at the Australian Wine Index.
'The price of fine wines rarely goes backwards,' he said, adding that investors can look at returns of between 1 to 12 per cent per annum.
How to invest: You can buy wines by the bottle as an individual investor, or look for brokers like the Australian Wine Index to manage your portfolio.
What you should consider: Price of the wine, the vintage report containing details of how the grapes grew that year and whether it was a good crop, and critics' ratings.
You also need to be prepared to hold on to your wines for at least three years for more attractive returns.
Mr Bassett said: 'The worst market situation we have now is that people are selling their wines at 11 per cent profit instead of their expected 28to 32 per cent profit because it is a buyer's market now, and everyone is pushing prices lower.'
Still, Mr Bassett feels that wine is a 'good, solid investment' because while the prices of stocks and shares can drop by as much as 80 per cent, the worst that wine prices can do is to stagnate.
Investor tips: Mr Bassett feels that it is a 'great time' to buy Australian wines now, especially since the exchange rate has dropped by about 30per cent, so you can get good value for money.
Two years ago, one of Mr Bassett's clients bought a bottle of 2005 Mollydooker wine. It cost $125 a bottle then, but his client sold it this year for $350 a bottle.
Mr Bassett said that investors should maintain a portfolio of 70 per cent 'blue chip' wines and 30 per cent cult and emerging wines, which are more risky but have the potential for very high returns.
Art and antique furniture
Why you should invest: For a good collectible item, the price will never come down, said The Tomlinson Collection's regional manager Jack Thew.
How to invest: Buy art pieces and learn the tricks of the trade through personal experience, or find a respectable dealer.
What you should consider: Investing in art and antiques, unlike the stock market, is not purely about money.
Potential investors should understand trends in art and appreciate the beauty of the pieces in their own right, instead of buying them just as pure investments, said Mr Thew.
Investor tips: Chinese classical designs are an all-time favourite, said Mr Thew, with hard wood furniture made of Zitan wood and Huanghuali wood fetching the highest prices, sometimes more than $100,000 a piece.
Describing them as the blue chips of furniture investment, Mr Thew said: 'The prices of furniture made of those types of wood have increased like crazy.
'This is because they are imperial wood, which was used by the rich and famous. It is also a precious timber, because it takes more than 100 years just to grow six inches of the wood.'
However, not all pieces made of Zitan or Huanghuali wood may fetch the same value because of the different styles and designs of the subject, cautioned Mr Thew.
Investors can also look at buying thousand-year-old terracotta art pieces due to their rarity, said Mr Thew.
High-end watches
Why you should invest: People who put their money in watches are holding value that is better than what they have put into their stocks, said Mr Patrick Tan, executive vice-president of Sincere and head of the Sincere Watch Academy.
One such example is the Patek Phillippe Calatrava, which has doubled in price since it was produced 15 years ago, said Mr Tan.
Prices of watches increase because the cost of producing watches has gone up, explained Mr Tan.
However, it is difficult to determine how much watches appreciate by as consumer tastes are always changing, he added.
What you should consider: Look at the heritage of the brand, the craftsmanship and the engineering of the watch.
More established brands include Patek Phillippe and A. Lange & Sohne.
However, Mr Tan was quick to add that watches are not like durians, and there are no quick tips or 'bao jia' (sure win) guarantees for investors.
The key to investing is still having a good knowledge of watches and doing intensive research.
Investor tips: Buy innovative watches and special-edition watches, such as those released by watchmakers when they celebrate their anniversaries.
However, these are available only to a select few collectors who can 'justify that they are supporters of the brand', Mr Tan said.
One such watch, the Sincere Jubilee A. Lange & Sohne Double Split, released by Sincere during its 50th anniversary celebrations, fetched its owner a 40 to 50 per cent return when he auctioned it off six months later.
Only five of the limited-edition watches were made available to customers.
But Mr Tan's most important tip is for investors to buy what they enjoy.
'It would be a sad situation if people buy the watches purely for investment, but do not enjoy the watches,' he said.
This article was first published in The New Paper on November 2, 2008.