Collecting refers to the purchase of assets which it is hoped will increase in value, such as antique furniture and paintings.

The disadvantage of 'collectibles', as they are sometimes called, is that they produce no income all the return is in the potential increase in value and that value is usually subject to fashion and whims.

On the other hand, it can be argued that they give pleasure that is the return.

Collectibles can be damaged or stblen, so they must be insured at current replacement value, which means getting regular valuations: these can cost around 1% of value each time. It is also a good idea to keep coloured photographs and written descriptions.

In the event of a dispute about value, you can get help from the appropriate trade association.

Buying and selling at auctions involves the payment of high commissions (buyers 15%, perhaps, and sellers 10%).

Buying in a shop avoids commission, but how far can you trust them to buy and sell at accurate values?

For all collectibles, you do need to be aware of value and you should not buy for investment unless you have a lot of knowledge of your chosen category.

Art and antiques

A London art dealer recently said that art has not kept pace with conventional investment over the last 20 years. Sothebys have an art index which shows changes in value over 1, 2, 5 and 10 years, by category (paintings, ceramics, furniture, silver).

Classic or vintage cars

Classic cars are post 1939, over 20 years old. Vintage cars are pre 1939. As on all cars, capital gains are not taxable and compared with ordinary cars there should be no depreciation.

Insurance may be difficult and you probably need to be a mechanic as repairs are expensive.

It might be possible to earn some income by hiring out, for example for weddings.

Stamps

Most serious collectors specialise. A good collection can be assembled for £2,000.

Low value stamps tend to stay low in value only expensive ones appreciate.

British sets currently issued are valued at only 80% of face value so are not a good investment.

If you are selling a collection of stamps, perhaps inherited, and they are muddled, do not try to sort them out first as they are more exciting to an enthusiast in their mixed up state and so of more value.

Wine

The most established markets are vintage ports and Burgundy and Bordeaux wines.

You can start with as little as £500, which will buy three cases (12 bottles to a case) at around £150 each, but you must be prepared to keep them for a long time. Better to start by using a dealer rather than bidding at an auction.

You can of course make a larger investment to start with, intending to drink some, sell some and buy some more, but try to drink your loss items rather than the profitable ones!

Value is greater if bought and kept 'in bond' as duty and VAT are not paid. Storage costs about £5 a year for each case.

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