Are you interested in investing in wine? Art? Sports memorabilia? If you are, StartEngine is offering a wide range of alternative investments beyond debt and equity.
If you are looking for some diversification into physical assets (unlike non-fungible tokens), StartEngine has been building out its selection of collectible offerings in recent months using the Reg A+ exemption to sell fractional investments in collectibles just like a security.
A recent email distributed by StartEngine claims:
“StartEngine Collectibles features multiple sports trading cards on our platform. Sports cards are an alternative asset class that can help achieve greater asset diversification and potential returns. It is a high-risk market, but offers the possibility of outperforming typical equities markets.”
An example of a sports trading card option is a Jackie Robinson “Leaf Rookie Card” that has, so far, raised over $56,000 on a valuation of $533,000. StartEngine states that the PWCC 500 index – which measures sports cards – has reported a 12 year ROI (return on investment) of 175% compared to just 102% for the S&P 500. You invest in a fraction of ownership and then, at some point in the future, the card is sold – hopefully with a solid gain.
The offering circular affiliated with collectibles outlines StartEngines’ expectations:
“Despite their size, the alternative assets markets that we invest in, including fine art, wine, watches, trading cards, cars, memorabilia, are complex and often misunderstood due to their opaque nature. Unlike traditional asset classes such as equities or fixed income, there is a lack of transparency due to the limited publicly available data. The markets tend to be made and largely executed through private transactions, making it difficult for outsiders to gain insight. We believe there is an opportunity to use our platform to make these markets more liquid and transparent for investors of all means and backgrounds.”
The document adds that millennials tend to be big collectors and thus a target market for alternative investments like collectibles.
The whole thing is an interesting concept, all managed online providing a fractional investment on a physical asset that may, or may not, generate a return for individuals.
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