The Alternative Investment Market in 2018:
Because of the declining number of viable racing horses that are born, the chances that an owner of a racehorse will be profitable is increasing. Furthermore, the purses are increasing as well. The wonderful thing about this alternative investment market is that it is much easier for the amateur investor to own a piece of the pie with minimal financial risk. Horse syndication is the practice of selling shares that cover not only the value of the horse itself, but also the cost of its upkeep, training and medical care. It is a great way to be a part of the racing community without worrying about losing everything.
As in any alternative investment market , be aware that investing in horses is risky, especially if you are focusing on race horses. However, owning shares on a horse or two is an exciting and fun way to diversify your portfolio and increase your odds of profiting.
By investing in a race horse, you are not only looking for a percentage of any purse winnings from races. You are also looking at profits earned from selling the horse and for breeding the horse after its racing days are over. Stud or breeding fees can be quite large, especially for horses that win big purses.
Show horses, especially highly intelligent dressage horses, that qualify for the highest level of competition can also be a source of investment. Although the purses are not as high as with race horses, breeding fees can be quite large. This alternative investment market includes horses we see in the Olympics, in the National Championships as well as horses that are on the entertainment circuit. It takes a very high level, valuable horse with a lot of training to be able to perform as they do and the lucky investors will profit from their horse's abilities.
Investors that have profited from show horses usually begin with a list of what they are looking for in an investment horse, including age of the horse, transportation of the horse, health of the horse, and ownership and title transfers. In addition, the investor needs to understand what they will do in the event of transport problems and what type of documentation is necessary for owning and transporting the horse. One of the best ways to ensure this type of investment is to create a Self Directed IRA. Self directed IRAs usually net the best profits of these types of investment vehicles, even though they require a great deal of research and preparation.
Another part of this alternative investment market is breeding horses for money. Most investors will not be able to breed high end show or race horses, but will be able to breed quality horses that are in high demand mainly among amateurs. In order to do this, you need to have your own facilities and own high quality mares that are trained and have a good genealogy. Choose only the best stallions for breeding purposes; never your own stallions. Stallions are difficult and expensive to maintain; it is much easier to visit a stallion for breeding purposes than to own them. Names and genetics are your greatest selling points when selling your foals. Remember that you will not get rich from breeding horses. Rather, you will have great enjoyment while making a modest profit.
Choosing the best alternative investment can be difficult, so careful consideration is crucial. Your questions on best alternative investments will be answered by our industry experts, free of charge.
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