Thursday, June 06, 2013


As you may or may not know I am/was a collector of deact WWII weapons.  A great investment over the years and I can certainly recommend such approaches to investment.  Firstly, the acquisition of such items is a good hobby.  Learning the subject and finding that undervalued item is much the same as those who trade in stocks and shares.  And like stocks and shares demand and supply and future performance is everything.  But such a collection is a joy to own and display.

Now times are hard I have liquidated the collection (nearly all of it) for about a 25% return.  No exact calculations here but the basics are clear that any normal safe investment (i.e. not stocks) would have returned less and certainly provided less pleasure.  But this was primarily a hobby rather than an investment so it is with some sadness that I see the collection go.

So what next?  Well, the guns were fun but they were large and hard to transport etc.  So I have been looking around at what to put some money into next.  There are a wide range of antiques and collectibles that I could pick and it is important to understand this market.  It follows much the same rules regardless of the type.

1) The value goes up and down in cycles but on the whole it trends upwards.  The demand drives the price but also the supply.  Get a small supply and a large demand and you have high value.  The good thing about antiques is by definition no more can be made.  What is in the world now is all there can ever be.
2) Quality is everything.  Condition is important.  Take china.  Chips and cracks in a 1930s piece of china will make it all but worthless in most conditions.  A cracked an repaired medieval piece still has value.  Again, application of rule 1 (supply and demand) simply means that if something is rare and valuable then owning a damaged rare and valuable thing is still better than nothing.  So value is maintained to some extent despite condition.
3) Names Names Names.  Brand is not a modern thing.  In years of old there was top quality brands and cheap rubbish.  Not surprisingly cheap rubbish in years of old still has low value and top end design and brand retains value.  A rolex will hold its value but a Casio won't.   In 100 years time a Casio still be worth very little even if there is only one left in the world.
4) Age is no guarantee of value.  There are items that are thousands of years old but are worth less than a 50 year old piece of glass.  So hunting for things based purely on age is not a good plan.
5) Nobody buys what they lived with.  By this I mean you need to focus on your market.  What will be in demand?  This depends upon age of the buyer.  As a rule, nobody is interested in buying back stuff they used to own.  So if you were an adult in the 70s then you are very unlikely to buy stuff that you used to use every day.  It loses its appeal.  So items in any period are only attractive to the generation that follows.  So work out a few easy calcs.   People who will start to buy 20th Century stuff will be in their 20s (earliest really as they get their first home and start to have discretionary spend).  So any items of interest must be around 30 to 40 years old to start to have appeal.  The trend has been for 60s, then 70s and so it is not difficult to see that the 80s will be next.  80s items are clearly easier to come by and low in value (low demand, high supply).  Getting quality iconic 80s items is a good bet.
6) Eternal appeal.  Some things will always have a following and be less subject to trend.  The top end of the antiques market is always in play.  Those with money love unique special expensive and rare.  There is never a shortage of people with money.   So some things will always have a healthy market.  Beatles memorabilia is likely to come and go as the people who remember the Beatles drops.  The top end (John Lennon's signed underpants etc) are always going to be top end but the rest will probably not gain significantly in value.

So what to collect?  Well there are other considerations on top of the rules above.  The first is longevity.  By this I mean that for something to hold its value it must be in good condition and so you need to consider how you will store it and display it without risking lowering the value through damage.  Picking robust items is key unless you have some serious storage and display capabilities.  The size of items also plays a part.  If the collection requires thousands of items then collecting antique wardrobes is probably not a good way forward.  Number is of course important.  Do you try for high numbers of low value items or fewer higher value?  My gut feel is buy things that are as undervalued at the time as possible and worth as much as possible.  Yes, on a downward cycle the drops will be more painful but if you time right the ups will maximise your pay back.

China:  There is a lot of cheap china around at the moment.  Trend is for Clarice Cliff and a few other names.  But these may trend down as the quality of the item is not the same as its reputation.  People are collecting items because of the name and names come and go.  On the other hand top end worcester will always be collected due to its quality of painting and the fact it is basically art on china.

Silver and Gold:  This is tied to the markets in terms of price.  It is hard to make 'finds' in this area as everyone is out there hunting.  Coming across gold and silver of any value is almost impossible.  It is marked and even if people do not know the dates etc they recognise that a hall mark means gold and silver.  Its one area where the TV has educated the general population.

Jewels:  Finding jewellery is also hard for the reasons above.  Top jewels tend to be mounted on precious metal and this is generally marked.  Without a lot of practice and knowledge and tools it is hard to identify stones.  Its a number game.  You have to buy up a lot of tat to make a find.  Lots of specialists out there looking.

Furniture:  Top end always holds value in the long run.  Bottom end 100 year old Ikea equivalent is not going to be valuable ever.  Too poor quality.  It takes up a lot of room.  That said, if you are going to put furniture in your house then buy antiques.  It is better quality than you will buy new unless you are paying premium new furniture costing thousands and thousands.  When you can pick up antique pieces at less than Ikea prices why would you buy chip board over teak or mahogany or oak etc.

Watches:  A great are to look at. Car boot sales are full of watches and the general population does not understand the valuable brands beyond a few (Rolex etc) and they never make it to the tables.  But lots of others do and so this is an area where finds can be big.  You can also buy from traders and there is a lot of documentation on them.  There is a watch to collect for every budget.  They are repairable and small to store.

My selection is none of the above.  I am going for Pewter.  Why?  Well there is a nice range of items in value and because it is out of fashion it is all pretty cheap at the moment (top end is still high value).  It is relatively easy to store, does not degrade if looked after correctly.  It is attractive in its own right and there is a range of brands and quality.  The key for me is that very very few people understand the markings.  Gold and silver are well documented and straight forward to identify.  Pewter is not.  This means that a 200 year old piece can be found next to a 30 year old piece.  One worth £2 and one worth £200.  Yet nobody could tell if you are not in the know.

What is also incredible is that you can pick up a mid 19th Century piece of Pewter for a few pounds still.  Real antique, nice to display.  So this approach provides a double opportunity.  The first is that there are still finds to be had relatively commonly each month out there in house clearance and car boots etc.    This means that you get instant return.  Buying £100 value items for £5 gets you an immediate buzz and return.  Those items then continue to rise (albeit in cycles).  We are also on a deep down cycle in pewter at the moment in the lower end of the market meaning that even identified and correctly valued items are likely to rise as the cycle moves on.

My first item I picked up last week was a 1857 tankard with lid at a car boot.  Paid £18, probably worth £80 to £120.  I picked up a French bowl for £35 at a shop, probably worth £50-£80.

Its a good start.  There is are lots and lots and lots and lots of dull 20th Century tankards out there.  Gzillions of them.  They help hide the real items nicely


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