Three-Year Interest-Free Credit
By Dr. Steve Sjuggerud
December 20, 2007
As I see it, my job is to find you exceptional things to do with your money... things that you probably wouldn't come across on your own.
Today's idea qualifies...
I'll show you how you can own an investment-grade portfolio on credit for three years. Interest free.
In a way, it's like buying a $100,000 portfolio for $85,000 today... Said another way, with no interest for three years, it's like buying in at a 15% discount.
Even better, at the end of the three years, you don't have to come up with the $100,000. Instead, you can just square up.
What I mean is, if the portfolio is up by $50,000 in three years, the company will send you a check for your profits. And if it's down $20,000, then you're responsible for the loss, of course. The point is, even after three years, you don't have to come up with the full amount.
This offer came out of a phone conversation I had with the CEO of Stanley Gibbons last week. Stanley Gibbons is a 150-year-old, debt-free company trading on the London Stock Exchange. (I'm a believer in the company. I first visited the company and met the management in 2005. A few months ago, joined the company's board of directors).
The CEO brought up this new three-year offer, and I had to share it with you.
Stanley Gibbons deals in investment-grade collectibles – particularly rare stamps and autographs/memorabilia. What's "investment grade?" Basically it means items that should be in museums... A few examples from the current stock include a document signed by King Henry VIII (from 1513) and a signed letter from Beethoven (from 1816).
In short, Stanley Gibbons is offering the three-year interest-free credit only on investment-grade portfolios – portfolios containing high-quality items like those two I mentioned. (Since it's an English company, it deals in British pounds... So change the $100,000 example to £100,000... and remember that exchange rate fluctuations will affect your returns to some extent over the three years.)
If you've been a reader of mine for any period of time, you already know that I am a believer in high-end collectibles. The very best stuff consistently increases in value over time. If you want to succeed in collectibles, you must do two simple things: 1) Stick with the highest-quality items, and 2) deal with the most reputable dealer in the business. (Sounds simple. It's amazing how many people screw this formula up.)
It's tough to find cheap assets these days. But I think some sectors of the high-end collectibles market – including rare stamps, coins, and autographs – are still basically under the radar. For example, hedge funds are buying art. But they aren't buying rare coins – yet. One big investor is an exception... The Bond King Bill Gross just auctioned his British stamps this year. He had great stuff. He made four times his money – in six years of owning them. I was standing next to him as he told the Bloomberg reporter "that's four times profit – better than the stock market..."
Stanley Gibbons requires a 10% deposit on this interest-free credit offer. So a $100,000 portfolio would require a $10,000 down payment. If the portfolio went up by 30% in value, then you'd have made a profit of three times the money you put down. Of course, that type of leverage can work against you if the items go down in value.
This offer has too many details to lay out here... like 1) choosing the items that are right for you, 2) your options to exit in three years, if you choose, 3) the minimum investment, 4) the fact that this offer could "sell out," as the company can't do an infinite amount of it, and 5) the limited timeframe... But if you contact Stanley Gibbons, make sure they review these details with you.
This offer is a bit of a test for the CEO. He's limiting the amount that can go into these three-year deals. And he's limiting the offer to just one week... The three-year interest-free credit offer ends on December 28.
I have the Beatles and the Rolling Stones autographs on my wall at home. I bought them from Stanley Gibbons (I paid full price by the way). I picked them out myself while in the London showroom.
I'm happy to own these indefinitely. But it would have been nice to buy them for the equivalent of 85 cents on the dollar – through this three-year interest-free credit deal – with very little money down...
With this current offer, you can literally get in at a better value than I did. Good stuff. If you're interested in diversifying a bit out of stocks and bonds and into high-end collectibles, this is one good way to do it.
For all the details, contact Adrian Roose of Stanley Gibbons toll free at 866-644-6146 or by e-mail at aroose@stanleygibbons.co.uk.
Good investing,
Steve
Editor's note: Steve Sjuggerud is a regular contributor to DailyWealth, a free investment newsletter focused on the world's best contrarian opportunities. We write with a simple belief in mind: You don't have to take big risks to make big money with your investments.
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