This article is an extract from Transmission Private’s monthly newsletter, The Lede, which tracks the world of reputation management for private clients. You can sign up for the newsletter on our website via the tab at the bottom of this article or by completing the form here.

There was a bumper crop of asset sales last year in several alternative investment categories. Auction records were broken for paintings (Picasso’s Femme assise près d’une fenêtre (Marie-Thérèse) sold for $103.4m), manuscripts (a first print of the US Constitution went for $43.2m) and trainers (Michael Jordan’s Nike Air Ships set one sneakerhead back $1.5m), according to Knight Frank’s Wealth Report 2022.

What’s the big deal? There are two reasons why people buy a collectible. Either they want to have it for its own sake, or they think it’s a good investment. The fact that prices are rising simultaneously in art, fine wines, scotch whiskies, classic cars and watches indicates that it is investor interest that is growing, rather than niche tastes.

Is this a flight to safety? No. Although I can’t help but noticing that – with the possible exception of Michael Jordan’s used trainers – these asset classes are all long-term stores of value, this trend isn’t driven by any ideas of preserving wealth through World War Three. It’s mainly about inflation. Real returns are proving hard to find, and the alternatives mentioned have all held or grown value rather well. But it’s also because it’s getting easier to access alternative markets, and awareness is growing.

What about NFTs? Ah, yes. Non-fungible tokens and other digital assets have also been setting records. In November, a Metaverse company paid $2.4m for some prime ‘real estate’ in the charming Decentraland, while according to investment bank Jefferies, the NFT market will be worth more than $80 billion by 2025.

Time to give up on the real world and move to the metaverse then? Let’s just say there’s some way to go before digital properties reach a scale anywhere close to the real thing as an investment class. Knight Frank’s attitude survey found that two-thirds of ultra-high-net-worth individuals’ assets are in property. London, incidentally, still had by far the most cross-border real estate investment of any city last year, at $3bn.

Anything else worth noting? Only that the Wealth Report indicates a sizeable increase in the number of UHNWIs. Globally, the number with net assets over $30 million increased 9.4% in 2021, and in the UK by 11%. Whether that continues this year, given stormy geopolitical and economic conditions, remains to be seen.

Takeaway... There are more wealthy clients and would-be clients out there than ever, and more ways for them to invest their wealth. It will benefit advisors of all flavours to do their research into alternatives as they increasingly hit the mainstream.