As a former financial planner, the very term emotional assets has fascinated me for most of my adult life. The concept may seem counterintuitive to those of you who haven’t heard about it or to those who believe emotions have no place in the world of investing—and in many cases, this is definitely true. But from the point of view I’m considering, emotional assets have a place in the investment equation.
Defining Emotional Assets
By definition, an emotional asset is something real and tangible that has been collected and has the potential to increase in value over time because it is rare and desired by many. There are a wide range of collectibles in this category—from art and photography to rare stamps, diamonds and vintage watches. I have proven during my decades of buying them that antique and primitive textiles are also emotional assets, the stability of their value proven over a long stretch of time, especially during times following economic downturns when investors begin to reassess their ingrained assumptions regarding the performance of a range of financial assets and investments.
Because I have been amassing textiles for decades, I have solidly made the transition from an amateur collector to an investor collector, my financial-planner career days taking me to points around the globe where I found treasures for myself, friends, family and my staff—always things I felt had a timeless feel. My early days of traveling throughout the US, when I was collecting high-end fashion and enjoying spas, morphed to bringing home antique furniture, porcelains, and other collectibles that spoke to me. Each piece became a treasure in my home, melding gracefully as a whole as I added things I loved.
Collecting as You Travel
As my international travel increased, so did the opportunities to invest in more exotic assets—some wearable, others to enjoy visually. On any given trip, I might bring home a Rolex and Appenzell embroidered wedding handkerchiefs from Switzerland; pearls, and custom-tailored cashmere suites and evening gowns from the Orient; and 18th-century mirrors, sewing boxes, and fine linen tablecloths from France. In Russia, I would search out painted boxes and caviar (okay, the latter is not meant to be a lasting asset but it certainly was enjoyable!); and in Hong Kong, I found custom-made black diamond furs and silk embroideries that I framed and hung on old marble walls.
Canadian fox from Banff made it into my suitcases, as did Irish crystal and laces from that fair country. It was also lace, as well as linens and Brugge cabinets, finding their way into my heart in Belgium. But it was when I moved to Budapest and bought a circa-1786 home in Veresegyház that I met my match in the form of Hungarian embroideries and Austro-Hungarian Empire textiles. I’d never seen gorgeous primitive hand-woven textiles for the home like the specimens I found there. These jacquard weaves and embroideries were as beautiful on the inside as on the outside and I’d simply fallen head over heels in love with them!
I bought incredible earthenware and pottery, each piece fashioned for a purpose that remain valid in contemporary life—falling into the category I like to call useful beauty. It was all so unbelievably luxuriant to someone like myself who had never experienced such fine handwork and craftsmanship. But more than mere fancy, the collections and homes I was able to tour while living in Hungary trained my eye as to what it really meant to be holding something of exceptional quality.
These treasures might have been born on dates followed by BC, the fabrics and embroideries I was finding springing from as early as the 12th century. Every exquisite museum-quality textile I came across was in remarkably great shape for its age, and, though I didn’t intuit it at the time, they inspired my future collecting, the things I brought home becoming some of the best investments of my life.
Tangible and Emotional Assets Include Fine Textiles
The World Wealth Report advises Investors to consider allocating a portion of their fiscal resources to emotional assets because they enhance portfolio diversification; bring a proven store of value, especially in times of crisis; give them a good inflation hedge; offer a unique type of return; and represent the potential to benefit a portfolio from rapid price escalation.
The report also explains that emotional assets—such as art, diamonds, rare stamps and coins—pose no systemic and contagion risk to a portfolio. This consideration alone makes them an invaluable addition to any investment strategy, a theory I’ve proven by my collecting in the past and present—my remarkable cache of textiles an ageless example of smart investing with sumptuous aesthetic returns. Do you have a collector side? If so, what is your favorite type of treasure to unearth?
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