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
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.
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.
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.
Your portfolio should not invest in any Ferrari.
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