Classic cars, coins and fine wine have been the best investments in the last five years
Just a day after posting its biggest one day decline, the price of gold skyrocketed last week as scares over the spread of the coronavirus caused a ‘flight into safe havens’ by many investors.
However, the latest research by peer to peer lending platform, Sourced Capital, has found that over the last five years, gold has been one of the worst investments one can make.
Sourced Capital looked at the average annual rate of return across a number of traditional investment options over the last five years, which are topping the table as the most lucrative and what return you would have gained from a £1,000 investment.
The research shows that classic cars have been the best investment in the last five years, with an average annual rate of return hitting 16% meaning a £1,000 investment would see a return of £1,136 today in addition to your original investment.
While gold hasn’t fared so well, investing in rare coins has been a pretty safe bet, returning an additional £1,033 on a £1,000 investment with the average annual rate of return sitting at 15%.
Fine wines rank as the third most lucrative investment returning an average of 13% each year or £859 on your investment.
While prime bricks and mortar hasn’t performed well with an average annual RoR of just 6%, investing through a peer to peer lending platform such as Souced has proved a much better option, with an annual RoR of 10% returning £611 in addition to a £1,000 investment.
Vintage watches (8%) jewellery (7%) and good old fashioned stamps (7%) have proved the next safest bet, while the FTSE 100 (6%) sits on par with prime property investment and as previously mentioned, gold brings up the rear with an average annual RoR of just 5% over the last five years.
Stephen Moss, founder and MD of Sourced Capital, commented:
“The recent surge in the popularity of gold is likely to be short lived and although it can bring some huge returns, these more volatile options are also prone to huge losses.
When it comes to the more stable investment options, the classics such as cars, rare coins and fine wine seem to bring the most consistent returns on a long term basis. That said, while bricks and mortar has traditionally been as safe as houses, a Brexit inspired market slowdown has even seen that drop down the table.
However, we’ve also seen investment in the property sector evolve as a result with a greater preference to invest via peer to peer platforms and while capital is always at risk, new age options such as the Innovative Finance ISA have seen many investors average 10% annually through property investment, with some achieving returns as high as 12%.
Of course, for the professional investor spreading your investments across a number of options not only diversifies your portfolio but mitigates the risk from the more volatile investment classes while allowing you to make the most of the various rates of return available.”
What is an IFISA?
The IFISA is a category of ISA which was launched in April 2016 for UK taxpayers and can provide returns as high as 10-12% an annum, although capital is of, course, at risk. Previously, there have been two main types of ISA: Cash ISAs and Stocks and Shares ISAs.
Similar to these ISAs, the IFISA allows you to invest money without paying personal income tax. This enables you to invest your money into the growing peer to peer market.
Like cash ISAs Each tax year, you get an allowance of up to £20,000 to put into IFISAs which you can distribute across your different ISAs should you wish to. In addition, you can transfer your previous year’s ISA investments into your IFISA.
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Average annual rate of return (2015-now)
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Type
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Average %
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Classic Cars
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16%
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Coins
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15%
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Fine Wine
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13%
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Sourced – property development
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10%
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Vintage Watches
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8%
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Jewellery
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7%
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Stamps
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7%
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Prime property investment
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6%
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FTSE 100
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6%
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Gold
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5%
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Return on £1,000 invested
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Type
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£ gained (from 2015-2019)
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|
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Classic Cars
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£1,136
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Coins
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£1,033
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Fine Wine
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£859
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|
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Sourced – property development
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£611
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Vintage Watches
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£496
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Jewellery
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£386
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Stamps
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£380
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Prime property investment
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£343
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FTSE 100
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£326
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Gold
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£264
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£1000 investment in the last five years
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Year
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Classic Cars
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|
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Classic cars investment – ave rate %
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Classic cars investment £
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start
|
–
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£1,000
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|
2015
|
16.39%
|
£1,164
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2016
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16.39%
|
£1,355
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|
2017
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16.39%
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£1,577
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2018
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16.39%
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£1,835
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2019
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16.39%
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£2,136
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Year
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Coins
|
|
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Coins investment – ave rate %
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Coins investment £
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|
|
start
|
–
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£1,000
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2015
|
15.25%
|
£1,153
|
|
2016
|
15.25%
|
£1,328
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|
2017
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15.25%
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£1,531
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|
2018
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15.25%
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£1,764
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2019
|
15.25%
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£2,033
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Year
|
Fine Wine
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|
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Fine wine investment – ave rate %
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Fine wine investment £
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|
|
start
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–
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£1,000
|
|
2015
|
13.20%
|
£1,132
|
|
2016
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13.20%
|
£1,281
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|
2017
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13.20%
|
£1,451
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2018
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13.20%
|
£1,642
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2019
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13.20%
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£1,859
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Year
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Sourced property development
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|
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Sourced property development – ave rate %
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Property development – Sourced £
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|
|
start
|
–
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£1,000
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2015
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10%
|
£1,100
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|
2016
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10%
|
£1,210
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|
2017
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10%
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£1,331
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2018
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10%
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£1,464
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2019
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10%
|
£1,611
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Year
|
Vintage Watches
|
|
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Vintage watches investment – ave rate %
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Vintage watches investment £
|
|
|
start
|
–
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£1,000
|
|
2015
|
8.39%
|
£1,084
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|
2016
|
8.39%
|
£1,175
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2017
|
8.39%
|
£1,273
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|
2018
|
8.39%
|
£1,380
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2019
|
8.39%
|
£1,496
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Year
|
Jewellery
|
|
|
Jewellery investment – ave rate %
|
Jewellery investment £
|
|
|
start
|
–
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£1,000
|
|
2015
|
6.74%
|
£1,067
|
|
2016
|
6.74%
|
£1,139
|
|
2017
|
6.74%
|
£1,216
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2018
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6.74%
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£1,298
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2019
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6.74%
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£1,386
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Year
|
Stamps
|
|
|
Stamps investment – ave rate %
|
Stamps investment £
|
|
|
start
|
–
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£1,000
|
|
2015
|
6.65%
|
£1,067
|
|
2016
|
6.65%
|
£1,137
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2017
|
6.65%
|
£1,213
|
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2018
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6.65%
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£1,294
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2019
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6.65%
|
£1,380
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Year
|
Property – Prime
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|
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Property investment ave rate %
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Property investment £
|
|
|
start
|
–
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£1,000
|
|
2015
|
6.07%
|
£1,061
|
|
2016
|
6.07%
|
£1,125
|
|
2017
|
6.07%
|
£1,193
|
|
2018
|
6.07%
|
£1,266
|
|
2019
|
6.07%
|
£1,343
|
|
Year
|
FTSE 100
|
|
|
FTSE 100 – ave rate %
|
FTSE 100 – investment £
|
|
|
start
|
–
|
£1,000
|
|
2015
|
5.80%
|
£1,058
|
|
2016
|
5.80%
|
£1,119
|
|
2017
|
5.80%
|
£1,184
|
|
2018
|
5.80%
|
£1,253
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|
2019
|
5.80%
|
£1,326
|
|
Year
|
Gold
|
|
|
Gold – ave rate %
|
Gold – investment £
|
|
|
start
|
–
|
£1,000
|
|
2015
|
4.80%
|
£1,048
|
|
2016
|
4.80%
|
£1,098
|
|
2017
|
4.80%
|
£1,151
|
|
2018
|
4.80%
|
£1,206
|
|
2019
|
4.80%
|
£1,264
|
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Sources for the average annual rate of return
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Peer to peer lending
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Sourced Capital data
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FTSE 100 info
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Gold prices
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Others
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