Real estate, cryptocurrencies and collectibles are the most popular alternative investments in the UK right now, according to a study from NexGen Cloud.
The cloud computing and data centre investment company commissioned an independent survey among 889 UK investors, all with portfolios worth over £10,000, excluding any primary property, savings, pensions or SIPPs. It found that 43% are more likely to consider alternative assets to make their money work harder in the current low interest rate environment.
Real estate is the most common alternative investment in the UK, with 17% of investors holding this asset and a further 19% considering investing in this asset in the coming 12 months.
Cryptocurrencies and collectibles are neck and neck
Cryptocurrencies and collectibles (such as art, wine and classic cars) were the next most popular alternative assets (both 14%).
One in eight (13%) UK investors currently hold investments in commodities, making it the fourth most popular alternative asset. Precious metals (12%) came fifth, followed by ESG investments (11%), private equity (10%), debt investment (9%) and hedge funds (8%).
NexGen Cloud’s research found that 30% of UK investors enjoy the fact that the alternative investment sector enables them to invest in more specialised fields that they know more about or are passionate about. A fifth (20%) said their current portfolio is weighted more heavily towards alternative than traditional assets.
Chris Starkey, founder and director of NexGen Cloud, explained: “Alternative investments have become more and more popular in the UK over the past decade, with investors increasingly willing and able to access markets they may not have before. The current record-low interest rates and volatility caused by the pandemic has only accelerated this trend, resulting in more investors looking for new ways to making their money working harder.”
Cryptocurrency market is becoming more widely embraced
Clearly, the UK’s love affair with bricks and mortar as a safe haven asset is still burning strong. However, the fact that crypto is now second on the list shows just how quickly this market has moved from relative obscurity into the mainstream.
More generally, there is increased interest in investment in new technologies, such as blockchain, cloud computing and data mining – this is only likely to become more prominent, with these markets expected to grow rapidly in the coming years.
The market research was carried out between 29th June and 5th July 2021 among 2,001 UK adults via an online survey by independent market research agency Opinium.
Opinium is a member of the Market Research Society (MRS) Company Partner Service, whose code of conduct and quality commitment it strictly adheres to. Its MRS membership means that it adheres to strict guidelines regarding all phases of research, including research design and data collection; communicating with respondents; conducting fieldwork; analysis and reporting; data storage.
The data sample of 2,001 UK adults is fully nationally representative. This means the sample is weighted to ONS criteria so that the gender, age, social grade, region and city of the respondents corresponds to the UK population as a whole. These questions focused on a collection of 889 people within the sample who have investments worth in excess of £10,000, which does not include their primary residential property, savings, pensions or SIPPs.
