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Why Financial Advisors Are Parking Client Capital in Collector Cars

In an era where traditional portfolios are underperforming, financial advisors are steering clients toward alternative investments. This article delves into the growing trend of incorporating investment-grade collector cars into diversified portfolios, highlighting their potential as tangible assets and inflation hedges.
This article covers:
  • The shift from traditional 60/40 portfolios to alternative assets
  • The appeal of collector cars as a tangible investment
  • Performance comparisons between collector cars and traditional assets
  • How MCQ Markets facilitates access to collector car investments

The Decline of the Traditional 60/40 Portfolio

The classic 60/40 portfolio—allocating 60% to stocks and 40% to bonds—has long been a staple in investment strategy. However, recent market volatility and low bond yields have prompted financial advisors to seek alternative assets to enhance returns and mitigate risk. According to a report by Cogent Syndicated, 70% of advisors now incorporate alternative investments into client portfolios, with allocations expected to rise from 7% in 2024 to 9.8% by 2026.

A Tangible Change in the Game
This shift isn’t just coming from individual advisors—it’s being echoed by major institutions. BlackRock and JPMorgan have both expanded their offerings in the real assets and private markets space, noting their resilience in inflationary environments.
Hedge funds and pension funds have also been increasing allocations to real estate, infrastructure, and collectibles, seeing these tangible investments as durable stores of value amid economic instability. With growing client demand and a shrinking pool of reliable traditional options, financial advisors are increasingly steering portfolios toward alternative assets like investment-grade collector cars, which combine scarcity, cultural significance, and performance history.

Collector Cars: A Tangible Asset with Historical Appeal

Investment-grade collector cars offer a unique blend of tangible value and historical significance. Unlike traditional assets, these vehicles provide emotional satisfaction and a sense of ownership that resonates with many investors.

Over the past decade, collector cars have shown impressive returns, often outperforming traditional investments. The Knight Frank Luxury Investment Index reports that classic cars have appreciated by 185% over the last ten years, surpassing other luxury assets like art and wine.

MCQ Markets: Democratizing Collector Car Investments
MCQ Markets is at the forefront of making investment-grade collector cars accessible to a broader audience. Through fractional ownership, investors can participate in this asset class without the need for significant capital outlay. This approach not only lowers entry barriers but also allows for diversified exposure within the collector car market.

Conclusion: Diversifying Portfolios with Collector Cars

As financial advisors seek to enhance portfolio performance and mitigate risk, investment-grade collector cars emerge as a compelling alternative asset. Their tangible nature, historical appreciation, and emotional appeal make them a valuable addition to diversified investment strategies.(Barron’s)

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