Investing in precious metal
For decades, precious metal has been a favourable investment, chosen to diversify portfolios and act as a hedge against inflation. During times of financial uncertainty, such as before an important political event or an anticipated harsher economic climate, demand for precious metals such as gold and silver increase. Why? Gold, for one, has a history of maintaining its value in the long term and is therefore considered by many as a ‘safer bet’ to place their money in.
Currently, and not surprisingly, demand for gold has hit a four-year high, as more private investors flock to gold to grow their holdings. However, although it is widely considered as an ‘excellent’ inflationary hedge by some, gold doesn’t often provide a good return. Alongside this, like every investment, there comes a risk. The price of gold relies heavily on the strength of the US dollar, and can therefore fluctuate; it also relies on central bank reserves, interest rates and many other factors.
So, with this in mind, what about investing in a different kind of ‘metal’?
Investing in heavy metal
With The Beatles' first pressed 1968 self-titled album, known as The White Album, selling for an astounding $790,000 at auction (over £590,000), and a Sex Pistols’ God Save the Queen single from 1977 selling for £12,675, it’s clear that one potentially profitable way to invest in rock music is by purchasing rare or signed memorabilia. Interestingly, even vintage band t-shirts can fetch a staggering amount when sold; Led Zeppelin's Knebworth backstage pass tee from 1979 is considered one of the most sought-after t-shirts from the rock band in the world, and is worth over $10,000.
Alongside placing your money in rare music collectibles, you can invest in musicians to help fund an album, gig or even a comeback tour. Sites like Kickstarter and PledgeMusic showcase artists that are looking for funding, offering a stake in the project for an agreed price. Some artists on the sites, like American singer-songwriter Amanda Palmer, have already experienced big success by crowdfunding, as it becomes a modern way of raising capital for cultural projects.
However, it’s also worth remembering that music’s landscape is continuously changing. The evolution of technology has been highly influential; vinyl sales have soared in 2016 to an impressive 28-year high, after previously being replaced by tapes, CDs and downloads. This highlights the similarity between precious metal and heavy metal - their ever-changing, often unpredictable market trends.
The fact remains that whether you invest in metal or Metallica, or even another concept, before you do, you need to research, seek advice and understand the full risks.
Oh, and it’s also worth remembering that there are, of course, other rock bands out there besides Metallica…
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