A new survey of UK-based investors has found that Brits sentiment towards alternative investments is increasing due to fears borne from the country’s rising inflation. The research found that almost 1 in 5 UK investors had made an alternative investment in 2022.
Alternative investments have proven to be a shrewd move for countless investors over the past few decades. When people are asked to list things to invest in, they will usually cite stocks and shares and bricks and mortar. However, today and with advancements in technology, anyone can invest in anything deemed legal.
What is an alternative investment?
The term alternative investment is basically the catch-all for anything non-traditional, and among the most popular of these are art, classic cars, NFTs, watches, wines and spirits, jewellery and antiques. However, over the years, toys, memorabilia, vintage clothing, vinyl and most things deemed retro and more have attracted the interest of investors.
Alternative investments are often linked to the investor’s personal interest; after all, if one is investing in something that they know about and enjoy, and if things don’t go exactly as planned, there’s always the enjoyment factor, which usually offsets any potential financial pain.
A study by Shojin, an FCA-regulated online real estate investment platform, found that half of UK investors have either made alternative investments this year or are considering doing so by the end of 2023 as they seek inflation-beating options.
The FCA-regulated investment platform commissioned an independent survey among 690 UK adults, all of which have investment portfolios worth over £10,000 – this includes all forms of investments but discounts their savings, pensions and property used as a primary residency.
The research found that 18% of investors have made alternative investments in 2022, which include assets such as private equity, commodities, real estate and infrastructure. Among those aged 18-34, the figure doubles to 41%.
A further 32% are either considering making alternative investments within the next six months (17%) or in 2023 (15%).
Shojin’s study showed that two in five (39%) investors are more likely to consider alternative investments as a result of the high-inflation environment. Inflation hit a 40-year high of 9.4% in July, and the Bank of England expects it to reach 13% in late 2022.
Jatin Ondhia, CEO of Shojin, said: “With inflation topping 9% and likely to rise further in the months to come, investors are evidently weighing up their strategies carefully. Tellingly, our research shows that half of UK investors, and even younger ones, have made or are considering alternative investments in the current climate.
“This will be an interesting trend to monitor. Indeed, investors of all shapes and sizes will currently be evaluating different assets, markets and methods of investing – many will be seeking options that might stand a better chance of delivering returns that can either keep pace with or exceed the inflation rate.
“As ever, thorough research will be crucial so that investors make informed decisions to try to meet their short-, medium- and long-term goals. This is likely reflected in the fact that while 18% have made alternative investments in 2022, a much higher number (32%) are still evaluating this option, which is positive to see.”
About the research
The research was undertaken between the 1st of July and the 6th of July 2022. Two thousand adults took part in an online survey by Opinium, an independent market research company. Opinium is a member of the Market Research Society (MRS) Company Partner Service, whose code of conduct and quality commitment it strictly adheres to.
Read more finance news, guides and features here.