Is a1991Testarossa a good investment ? - Ferrari Life
 
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post #1 of 15 Old 01-09-2011, 11:52 AM Thread Starter
 
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Is a1991Testarossa a good investment ?

Hello
I am new to the forum
I am concerned about inflation and would like to shelter some of our savings.
I have always liked the Testarossas and I have a chance to get one at wholesale price .Would a 1991 be a good investment, if not the 355 ? Is value expected to go up ?
Any input would be appreciated
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post #2 of 15 Old 01-09-2011, 02:48 PM
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no. do not hedge inflation with a tr. buy gold and silver. YMMV



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post #3 of 15 Old 01-09-2011, 06:25 PM Thread Starter
 
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Hi Wetpet
We own a Maserati coupe CC and an MB500SL ,neither one will be an investment.The two other american antiques 1931 and 1948 might.So which Ferrari might be a good investment ?
I would like to hear a few opinion
Thanks
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post #4 of 15 Old 01-09-2011, 09:59 PM
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No on the TR. Better off with a BB, 288 GTO, F40, or Daytona.
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post #5 of 15 Old 01-10-2011, 04:07 AM
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well, that depends on a lot of factors. any way you slice it, the ferrari is gonna be risky. You specifically mentioned the 40-50k range and a hedge on inflation. I don't see a ferrari that matches that criteria. so i mentioned an alternative. If you change the parameters, maybe i can make another suggestion. The only less risky ferrari investments i see are more in the million $ range. Don't want to argue with boxer cause he certainly has more knowledge and experience than i do, but..... the cars below a 288 gto mentioned haven't exactly been going up recently. i think you need to be at least in 288gto territory to see that. Once you factor in transfer costs, repairs, maintenance, storage, insurance et al, i don't know how you can make much money over the next several years unless you steal the thing. Of course, that would go for anything you buy. If you got the tr for 25k you would make some money. but you might as well flip it at that point because you made all your money in the purchase.



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post #6 of 15 Old 01-10-2011, 07:20 AM
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Any TR will make for a difficult investment these days. They are at the stage of not being new but not being classics yet either. The magic number seems to be about 30 year old to enter the classic category. Other main challenge on a TR is the maintenance costs as a percentage of value. Even if you could buy a good one for $60k, you would need appreciation of close to 10% just to cover the cost of a cambelt change. Need a new clutch, gearbox, etc and the numbers get very ugly fast. Other issue is production numbers, Ferrari produced over 7000 TRs so rarity is not going to ever be driving values.

Buy a TR because you like TR's and then drive the crap out of it. That will make for at least a great emotion return on your money.
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post #7 of 15 Old 01-10-2011, 04:47 PM Thread Starter
 
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Thank you Boxer and Wetpet
I did not mention any $ amount but that I could get the 91 Tr at wholesale.
I have a feel for maintenance from my CC coupe . The way we are printing and spending money our dollar will not be worth much shortly.I have worked oversees and have seen inflation first hand . Certain investments had kept their intrinsic value. I was hoping a ferrari would be one .
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post #8 of 15 Old 01-11-2011, 08:47 AM
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Quote:
Originally Posted by Nishan View Post
Certain investments had kept their intrinsic value. I was hoping a ferrari would be one .
Many do, it is just a question of picking the right model.
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post #9 of 15 Old 01-11-2011, 12:05 PM
 
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Quote:
Originally Posted by Nishan View Post
I did not mention any $ amount but that I could get the 91 Tr at wholesale.
Oh boy...

Quote:
Originally Posted by Nishan View Post
I have a feel for maintenance from my CC coupe.
I don't think you do at all. The Maserati is a gnat on the service cost radar.

Not being mean, but you need to rethink this VERY carefully. Why would a car like this be wholesaled? I can think of about 40-50K reasons... ON TOP of what you are thinking is a bargain price.

Last edited by T.C.F.B.; 01-11-2011 at 12:15 PM.
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post #10 of 15 Old 01-12-2011, 05:23 AM
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Quote:
Originally Posted by Boxer View Post
No on the TR. Better off with a BB, 288 GTO, F40, or Daytona.
I love the TR, but the BB will continue to hold price - and at ~$100k (US), it's a fine value...

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post #11 of 15 Old 01-12-2011, 10:42 AM
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Quote:
Originally Posted by Nishan View Post
Hello
I am new to the forum
I am concerned about inflation and would like to shelter some of our savings.
I have always liked the Testarossas and I have a chance to get one at wholesale price .Would a 1991 be a good investment, if not the 355 ? Is value expected to go up ?
Any input would be appreciated
Very welcome!

Ok, this is a question which is bound to pop up every now and then. My friend, I do not mean in any way to seem impertinent but since you are speaking in investment terms about buying a Ferrari, here is my investment analysis based on your information.

General Background:
Very, very rarely can a car be considered an investment, let alone a good investment, which is your question. The few cars that actually turn out to be good investments are rarely purchased as such. They are bought with cash from the very top of the stash to be enjoyed. They are bought with imprecise knowledge or concern about binding time and appreciation. These cars have needed additional binding of capital during a long term perspective. These cars are of a category completely antipodal to the category you are describing.

Specific Background:
The cars you mention are in no way particular to the point where one might hope for a value with a positive stability over time.
The monetary volume of one Ferrari is going to constitute a concern on your real rate savings growth.

Summary Investment Analysis:
1. Long term
2. Yearly additional binding of capital before exit
3. No dividends during term
4. Nominal appreciation value is anything from very low to inexistent or negative

You have just passed the two first red lights on the investment analysis: 1 to 3 = first redlight, 4 = second redlight.

Conclusion (in a perfect world):
This is definitely where you can conclude your analysis by recommending a full stop in ploughing more resources into further investment analysis. In a perfect world it would have stopped at first redlight 'cause that's what redlights are for. Nevertheless, for the sake of argument we'll carry on.

Summary Investment Analysis, Cont.:
5a. Value of added investment in proportion to total portfolio value = inconsiderable
5b. Value of added investment in proportion to total portfolio value = considerable

More Expensive Conclusion:
It is in case 5a not recommendable to go ahead with the investment. Any opportunity cost is likely to be more favourable for the total portfolio value. Adding the new investment will however not constitute a risk of rocking the portfolio.

It is in case 5b (which is your situation) a bad investment plus a risk of rocking the portfolio. The rocking risk lies in the fact that liquid manueverability will be limited in case of external/non controllable damage to the portfolio.

You have just passed the third redlight on the investment analysis. Stopping here only involves a ticket for reckless driving without a crash, i.e. sunk costs which in this case are humble.

Recommendation:
Your portfolio should not invest in any Ferrari.

Note:
This analysis is based on the information given by the investor.
This is my way of analysing investments.
My experience does not come from car investments but from investments in machinery producing companies in the field of shipping and ship building.
My investments are successful.
External/non controllable damage = world crisis, sudden unemployment, divorce

Salve,
Capo

The bad news: Time flies
The good news: I'm the pilot

You cannot make life longer but you can make it wider and higher.

Last edited by il Capolino; 01-12-2011 at 11:04 AM.
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post #12 of 15 Old 01-12-2011, 02:06 PM
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With divorce equating to catastrophe and the others being minor irritations.
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post #13 of 15 Old 01-12-2011, 09:29 PM
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Originally Posted by a1exander View Post
With divorce equating to catastrophe and the others being minor irritations.
Oh I don't know, seriously. Excuse me for continuing on the square approach but money is all of a sudden a very serious matter when consciously invested as a corner stone in a household budget. Please note that the investor in this case, Nishan, says "our savings" when raising concern over real rate growth of "their" savings and whilst going on the same fresh breath of air seriously wants to consider a used Ferrari as part of the household solidity - It obliges me to take a professional standpoint. It is all more playful when we are looking at home free hard earned cash, consciously liberated from service in the family budget and consciously liberated from 24/7 standby emergency availability and definitely consciously liberated from inflation worries on your total portfolio, seriously!

This last world recession took half of many people's stash which is right up there alongside with divorce - seen purely from a risk consequence perspective. Very few people saw the big one coming so the level of preparation for it was a long, loooooong way from any couple's preparation for a divorce and I don't care how much in love that couple is. The world recession sure took half of my indirect investments and temporarily half or more of my direct investments! I had all my hard earned foundation in the ultimate balance for a long while which is a lot of pressure to take when it is what you actually rely on to live from. The pressure in fact drove me into a burn-out depression which has taken me the whole of last year, including brief hospitalization, just to sail clear. I can dearly assure you that it was not a minor irritation.

Besides, -and continuing on the investment approach, let me tell you a little about risk management as an investment tool on marriage. Divorce seen coldly as a risk is in fact an easy risk assessment to calculate. It is plain easy. There is plenty of fresh statistics available for a start. You are as an investor very, very far from a pioneering standpoint on divorce as a risk assessment, to say the least. If only all risk assessments were that graspable! Most importantly, you know exactly what you stand to lose, with or without prenuptial agreements, so you can assess the whole risk in your investment analysis and take immediate decisions. There is nothing more dangerous in risk calculation than uncertainty of the risk consequences and divorce does not classify as a catastrophe in an investment perspective, I'm sorry.

Anyway, you mustn't mind my combat rage on this issue. I am an amphibious battalion ex-marine and I've only recently lowered my weapons from defending my whole future so it is a subject I find hard to participate in without stepping aside from the regular laughter mode for a while. Sometimes you need to hose the pink water colour off the pony, so to speak.

Salve,
Capo

The bad news: Time flies
The good news: I'm the pilot

You cannot make life longer but you can make it wider and higher.
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post #14 of 15 Old 01-13-2011, 08:39 AM
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Capo

We have gone of subject somewhat you and I but let us continue briefly so that I may assure you that I was not being light hearted with my statement but serious.
Hence no smily faces and the like.

I view divorce as a catastrophe and not purely on the $ and cents.

Money on the other hand I perceive as something to be made used saved invested etc.
Man makes money and money does not make man.......if you get my meaning.

Talking of your foundation being stretched last year I know that many of the people in the same area of work as I, have had a torrid year with pressure from Labour Unions to increase wages as well as Banks to reduce debt whilst all the while the market has all but vanished.

The preceding year is one that I would rather not have had.

It also proved that "run of the mill" F cars are nothing more then "run of the mill" when the Global economy is in the state that it is in.

AND I am glad to hear that you are feeling better and that things will have a good outcome in the foreseeable future

Last edited by a1exander; 01-13-2011 at 08:41 AM. Reason: poor spelling......detention for you Johnny
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post #15 of 15 Old 01-13-2011, 10:15 AM
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Quote:
Originally Posted by a1exander View Post
I view divorce as a catastrophe and not purely on the $ and cents.

Money on the other hand I perceive as something to be made used saved invested etc.
Man makes money and money does not make man.......if you get my meaning.
I get your meaning very well. That is a sound as-it-should-be mindset and I salute you for it. This thread started however by venturing into intertwining the precious soft values with the unforgiving hard values.

My reason for answering Nishan in cold forged investment terms is exactly to make both of your above mentioned points, since the actual question was if you could make an investment case out of a Ferrari purchase on a household budget's savings. I react strongly against an investment approach under such circumstances, particularly when smaller factors like interest rates are going to make a difference.

I therefore believe a very cold and matter of fact investment analysis is a very adequate way to answer. An academic analysis shines the light on the mistake of bringing a bad investment all the way into your precious household. Enough already having to deal with it on business level! I therefore still don't think we are off topic.

I hope this makes it clearer that I don't see marital status through my investment eyes, totally on the contrary. I've been through enough sh1t already to appreciate what the beautiful values in life are and how to treasure them. That is why I wanted to stand up. Business is business and it is unforgiving. Keep household apart!

I thank you for your delight that I am coming out of the business gloom and the personal gloom triggered by it. It is truly a horrible feeling and I am very glad i smell the roses again!

Again, we are not off topic my friend. we are smack on the topic!

Salve,
Capo

The bad news: Time flies
The good news: I'm the pilot

You cannot make life longer but you can make it wider and higher.
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