Collectibles such as comic books, stamps, art, classic cars and vintage wine don’t have a quantifiable fundamental value. Sure, they offer a lot of enjoyment to collectors but only a fraction of them are considered valuable investments. When buying collectibles with the sole purpose of selling them for money, you must find someone who will want to pay more just to own it. What drives people to collect things, and where did it all start?
Tulip mania and people’s obsession with collecting tulips
Believe it or not, 4 centuries ago you couldn’t find tulips everywhere like today. In the 17th century, during the Dutch Golden Age, the price for tulips grew incredibly and some people would pay exorbitant amounts of cash just to own a certain variety or type of flower. Tulip mania was an absurd type of collectible that attracted Dutch traders obsessed with flowers in general. The trend faded pretty quickly due to malfunctioning markets, behavioral biases and basic economic concepts such as supply/demand irregularities.
The history of collecting things
They say “collecting things” is an ever-present human activity scattered through centuries-old civilizations. Historians have always been intrigued by antiques mainly because they bear a fascinating past. Collecting is a very old cultural practice that emerged during the Egyptian Ptolemaic Dynasty when the Library of Alexandria started gathering books from all over the world.
In Renaissance Florence, the Medici family started collecting art via private patronage, thus freeing artists from the debts they had. Nowadays, many international museums (such as the Metropolitan Museum in NYC, Franz Mayer in Mexico, Thyssen in Madrid) hold priceless art pieces donated by generous collectors who wanted for the whole world to admire their collectibles. We’re talking here about emotional collectibles with great value, but that are not for sale.
Collecting prints and engravings by people who couldn’t buy original art is another centuries-old hobby. In the 18th century, in Paris, the habit of collecting curiosity items related art expanded quickly in England as well. Ever since, the modern art markets of London and Paris have gained a reputation for being well documented.
New categories of antiques and vintages emerged in the 20th century when people started collecting jewelry, china, stamps, clocks, political memorabilia, wine and cars. Right now, a lot of items that are old (20, 50, 100 years old) are considered antiques. However, this doesn’t mean it’s easy to find someone interested in buying them from you.
Are all collectibles considered valuable assets?
No. The collectible market is faddish, illiquid and opaque. Selling art pieces is now tougher than ever from various reasons. First of all, replicating art is extremely easy “thanks” to advanced technology; second, finding an avid collector to buy what you’re selling is another difficult job. You have to participate in numerous auctions, as well as have your item checked over and over again for authenticity.
Fine wine as a collectible
Is fine wine a valuable collectible? First of all, we must emphasize that wine is a consumable asset. It’s a bit complex to buy fine wine as it demands a lot of patience. Proper storage conditions and good quality wine from reputable vineyards are essential steps to consider before starting spending money. There’s a golden rule to wine investments – invest if you genuinely like the product and your chances of success are greatly enhanced. Let’s not forget that most collectibles are emotional assets, things that people like and appreciate.
However, if you can afford to buy fine wine from auctions to sell afterwards, then by all means, do it. Many wine collectors are not drinkers, and they trade wine for pure financial purposes. This category of investors are extremely rational; they know the market and they’re experts at assessing which wine may increase in value and which will decrease.
The history of investing in collectibles is long and complex, even peculiar. Nonetheless, it’s certainly worth exploring. Starting with Tulip mania in the early 17th century and ending with art, stamps, wine and classic cars in the 20th century, we must admit that vintages have tremendous value, whether it’s emotional or financial. Before investing in wine, or in any other form of collectible, you are advised to deal with a reputable merchant in order to be sure what you’re buying is 100% legit.