Where to Invest $1 Million Right Now

Six experts offer timely ideas on where to deploy a big chunk of cash.
Illustration: Isabel Seliger
By Suzanne Woolley

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It’s scary out there.

Investors trying to cut through the market noise face immense challenges. Rapidly rising inflation is stoking fears that interest-rate hikes from central banks could usher in a global recession. Stock and bond markets are in turmoil, with the S&P 500 down more than 20% from its peak and US Treasury prices plunging. That’s all against the global backdrop of the war in Ukraine and the continuing threat from Covid.

It’s enough to make you long for the safety of cash — if inflation wasn’t sure to eat away at cash’s purchasing power over time.

Bloomberg spoke with six professional investors to get their best ideas on where investors with $1 million might want to deploy their money now. Choices vary from municipal bonds to the blockchain to uranium miners.

The experts also shared where they would deploy $1 million if they could put it toward a personal passion, with ideas ranging from clean-water technologies to Portuguese real estate and horse farms.

Stephanie Larosiliere

Senior client portfolio manager, Invesco

The great thing about municipal bonds, particularly going into this year, is the fundamentals and how much funding has come from the federal government in terms of Covid relief and other stimulus. It adds up to $1.6 trillion through 2024. That’s honestly probably a little bit more than was needed. That’s why we're calling for a continuation of the golden decade of municipal credit.

The macro issues are throwing a bit of a monkey wrench into that. There’s a lot of speculation about whether there’s a slowdown coming for the economy. But when it comes to municipal issuers, there’s still a lot of money for them to tap. That’s a prime example of why we continue to see more upgrades than downgrades in the muni market. It takes a lot of time to eat through $1.6 trillion.

At the end of the day, though, munis are about the tax-exempt income. I’ve been talking to a lot of advisers, and there was a bit of sticker shock this tax season. People expected more of the norm, but it was a bit worse than most people thought. As we start to draw up plans, tax-exempt income will become more important.

For those in the highest tax bracket, getting 4% on a short-duration high-yield municipal bond is equivalent to almost 7% on a taxable bond. We haven’t seen that in a very long time.

Right now the asset class is primed for investment because it’s not a crowded market like it was last year, when there were record inflows. Back then it was hard to find things you could really get excited about. The opportunity presented year-to-date has created opportunities and made it more interesting to invest.

It’s the retail-investor sentiment creating a negative feedback loop. When they’re fearful, they want to hoard cash and they’re afraid they’ll be catching a falling knife. At some point, munis will start to get cheaper and that will attract investors.

Another way to play it from Larosiliere: One of my outside interests are technologies designed to bring clean water to developing countries. It is estimated that 80% of illnesses in developing countries are linked to a lack of clean water. I believe this should be an area of interest for investors looking to align their investments with their values. When water supplies are improved and sustainable, it can significantly enhance a community’s economic growth, leading to a reduction in poverty. Investments in this space have the potential to not only add value to portfolios but make an impact in the lives of those in need. - Brian Chappatta

Kim Forrest

Chief investment officer, Bokeh Capital Partners

I like US stocks because they're liquid, and I like above a billion-dollar market cap because generally speaking those managements are a little more solid than at small-cap companies. In most cases, if you have a billion in market cap, you're not 100% in the US — you have a more geographically spread-out revenue stream.

Even though I want super-solid balance sheets, I need to see companies that have proven they can create whatever they do for at least one or two product lines, so they have more than one widget that they’re selling.

What I really want to see is companies, whether it’s a chemical manufacturer or a retailer, that use technology effectively. They may develop technology but they also need to use technology well internally because it gives you productivity. I was a software engineer — mostly what I did was custom software design to streamline operations — so I really value that.

Generally those companies have better margins than peers. You might think the technology would be robots and drones and stuff that looks cool, but what you really want is stuff that takes out error and a large amount of people doing repetitive tasks. It allows you to not have a bunch of people doing dumb work.

This is across all sectors — it could be even a utility company. The better a company can automate and focus whatever workforce they have on growing their customer base, that’s better for an investor. You can screen on things like return on invested capital or return on equity.

I believe in concentrated positions, so 3% for starting positions. We get about 31 to 33 holdings and then some cash. You're diversified but you can still outperform. A lot of years some of those companies are going to get bought out, so you have a pretty good shot at getting some buyouts each year.

Another way to play it from Forrest: A horse farm where you cater to the hunter-jumper crowd. It takes a lot of money to run, but you're charging people a lot of money to take care of their horses, and man, oh man, do you have a whole lot of fun. It can really be profitable. I don’t own a horse but I take riding lessons at a very fancy farm where they really take care of their horses. I would assume there’s pretty good margins because you're having a relatively small number of people take care of 60 horses and it’s skilled labor but it’s not crazy. Then you probably get agricultural tax benefits. Here in Pennsylvania, we have Clean and Green — you get a lower tax rate on your farm. If you have 10 acres or more you can apply for those. - Claire Ballentine

Claire Madden

Managing partner, Connection Capital

There are often requirements for liquidity between fundraising rounds at fast-growing tech companies, such as from seed investors who’ve been in for a long time. We’ve invested in a fund manager that targets this area, focusing on the UK and Europe, and you can often get into a company at a discount to their last fundraising round. The tech selloff means that a lot of companies are having to push their next fundraising round further out into the future as it’s just difficult to raise money. That means the universe of opportunity and therefore the discount you’re able to get in this area have increased.

It gives you exposure to tech outside the traditional tech funds that tend to be at least 10 years, meaning a lot of the liquidity is very back-ended. Secondary funds are normally going into businesses that will be doing another round in the pretty near future, and they’re not so wedded to seeing it through to the end, so they’re not as precious about selling out later. That means liquidity can happen quite quickly from these investments. You’re not having to take this long-term view.

Another way to play it from Madden: I am obsessed by big-wave surfing — watching, not doing — at Nazare in Portugal. I would invest in a getaway there. I think more and more people are waking up to the beauty of Portugal’s Silver Coast and its wild beaches and fantastic food. Who says an investment can’t also be good for the soul? - Ben Stupples

Luis Berruga

Chief executive officer, Global X ETFs

When I consider the increased digitalization of the economy and the growing demand for clean energy, three themes stick out as especially compelling: blockchain, cybersecurity and uranium.

Blockchain technology is upending many traditional areas of finance, and institutional investors are increasingly showing interest due to its many valuable use-cases beyond cryptocurrencies. Delivery of digital assets using blockchain technology can be a critical tool in tackling global poverty by providing millions of unbanked people across the developing world with access to banking services.

In the context of blockchain, I see this recent drop in market prices as an opportunity — blockchain is fundamentally different from some of the cryptocurrencies we’ve seen. The case for blockchain as a technology I don't think has changed.

Another theme that will be critical is cybersecurity. As cyber attacks rise in both scope and frequency, more companies are committing resources to protecting themselves from costly attacks. New tools including artificial intelligence and machine learning allow security firms to identify and investigate devices diverging from their “normal” behavior. We estimate the network security ecosystem could grow by an average compounded annual growth rate of 24% through 2026.

Another structural shift is the green energy transition. Governments are setting aggressive timelines for achieving net-zero carbon emissions, and many realize that nuclear energy, powered by uranium, will be central to reaching those goals. Pro-nuclear energy sentiment is growing, especially as countries weigh the effects on oil supply due to the war in Ukraine. Currently, Asia is the leading hub for new reactor construction. China has 18 traditional reactors under construction, India has six and South Korea has four. In total, over 50 reactors are under construction, representing significant annual growth. Uranium miners should benefit from growing demand, especially given that current supply lags could help sustain high prices for years.

Another way to play it from Berruga: Growing up in a small town in Spain called La Roda, I saw many people who had a positive attitude and work ethic but weren’t given a real chance to succeed because of a lack of financial resources or training. I’ve always thought setting up a platform to connect these communities with capital and training would provide a very attractive return on investment from a financial and social standpoint. It would provide financial resources and industry expertise while functioning as a hub for hiring and cultivating local talent. The structure would probably be a small private-equity fund with a social element as part of the investment guideline. I’d try to bring in my own capital and capital of third parties that bring some sort of operational expertise, and use that to co-invest with founders of these local businesses. - Claire Ballentine

Gabriela Chagas

Partner, Vox Capital

In a world struggling with Covid, inequality and climate change, the key word we've been repeating to our investors is legacy: How you can use your investments today to see the future you want to live in materialize?

So one of my biggest motivators right now, coming from an emerging country such as Brazil, is investing in assets that can help reduce inequality. That's why there's such a strong case for companies that help close the gap in financial inclusion. Brazil is a huge country with an immense percentage of unbanked population, something that's also true for other emerging markets. That means people have a lot of difficulty in making day-to-day payments and end up having to go to banking branches.

That’s an opportunity for startups. One of the main companies in Vox's portfolio, for instance, is Celcoin, which provides financial infrastructure that basically turns thousands of small-store owners around Brazil into mini-banking branches. They also get some extra revenues whenever someone pays a bill there or charges a prepaid phone. Ultimately, I believe that by giving people access to the financial system, financial inclusion ends up turbocharging the fight against inequality as whole.

Another way to play it from Chagas: A lot of people, myself included, have been looking for ways to achieve their own personal net-zero emissions. I’d do it though investing $1 million in recovering forests, in particular the Amazon. Today there are even NFTs backed by specific pieces of the rainforest because standing forests have become such a scarce asset that there are growing financial incentives to protect them. And prices of carbon credits tend to rise, so finding projects that generate them could end up paying off down the line. - Felipe Marques

Laura Tuttle

Co-chief investment officer, Boston Family Advisors

There's a lot of debate about the excesses in venture right now and whether we are facing another bear market similar to 2000. That said, we still see great opportunities in early-stage venture and believe now is a good time to be putting money to work. We actually think it's going to be good for the industry overall to have a bit of a shakeup.

We really like early stage. While those valuations have really been driven up, they have such a long runway they're a bit more insulated from what's going on in the public markets right now. And by the time they're thinking about IPOing or exiting, the environment can be very different. We've intentionally avoided late-stage venture, which we believe will be the area the most impacted by the downturn in the market.

We're asset allocators, we're not investing in portfolio companies directly, and it's our job to make sure we're investing in the right managers. We have a bias toward managers that are sector specialists — so not just folks that are good at doing deals and writing checks but that roll up their sleeves and work hand-in-hand with founders. The managers we back tend to take a more measured approach and are extremely disciplined. Over the past three to five years, for many, there were no rules and the playbook was thrown out. Now, the spotlight will be back on growing revenue, conserving cash, hiring methodically and improving business models.

Firms with clear specialization are our sweet spot. One manager we backed, for example, was one of the earliest East Coast firms focused on AI innovation. AI and how it's influencing cybersecurity is a really interesting area. We're investing in one manager that's focused on life sciences, early therapeutics. They've got a bunch of labs across the country where they can really cherry-pick great companies. The portfolio construction part of the equation is paramount — you want managers that complement one another.

Another way to play it from Tuttle: I will answer this with more of my “life dream” hat on versus my CIO hat, but you could call it a long-term real estate play that combines my love of a good fixer-upper and France. I spent a college semester abroad in Provence, and since then I have felt a pull to return to the French countryside to buy a dilapidated French farmhouse — something right out of “Under the Tuscan Sun” or Peter Mayle’s book “A Year in Provence.” Plus right now the dollar definitely goes a longer way. I would hire a small cadre of French artisans to restore my rustic residence that hopefully would quickly become an Airbnb hot spot. I could spend vacations surrounded by good wine, friends and family in my belle maison. — Devon Pendleton

Ophelia Snyder

Co-founder and President at 21Shares and Amun Tokens

I see a few major themes in tech and crypto. One is around crypto financial services, colloquially referred to as DeFi. Another is the broad category of NFTs that includes digital media, games, music and art. And a third is the metaverse.

When you think about crypto allocations, diversification is important. Right now, I’d be looking at placing the largest allocation of funds in Ethereum and Solana. At a medium-level allocation, I’d be looking at things like Avalanche, Fantom and Polygon, which are very promising but haven't reached that level of scale yet in the investor community.

I’m interested in newer Layer-1 chains, or systems like Avalanche and Solana, that are designed to create blockchains that are faster and more responsive. You’d be looking at tokens that have a similar pattern to how Ethereum works but are earlier in terms of adoption so there is more upside from growth. In the metaverse, which in some areas is closely tied to NFTs, I look at purchasable tokens like Sandbox (SAND), Decentraland (MANA), and NFTs for things like land or characters inside of some of these environments.

Most of these products are available on most of the major crypto platforms at this stage. The returns on these assets have been very, very steep. These are very high-volatility products, but they are longer-term technical bets. This is like investing in early Internet protocols.

Gaming, augmented reality and virtual worlds are very interesting. You would want more diversification here than amongst the L1s because, fundamentally, that's even earlier in terms of adoption and actual usability.

Another way to play it: Art, hands down. My thesis around buying art — and I’ve been collecting art since I was 7 and buying a $5 drawing at a flea market — is to buy the things you love and want to live with for a lifetime. Frequently, that will end up making you some money as a byproduct.

There are works by very, very famous artists in certain mediums that for some reason haven’t had the same price action as other formats. Andy Warhol did pen-and-ink drawings that are beautiful, and they don’t sell for tens of millions of dollars.

Meanwhile, some lesser-known artists are selling at lower price points that leave quite a bit of upside over a longer time horizon. Pietro Ruffo is a young Italian artist who is doing a big exhibition in the Vatican Library. He is an incredible artist but relatively unknown outside of Italy. Soraya Sharghi is a young Iranian artist who is doing some really extraordinary work. eL Seed is on the rise in the same way that Alec Monopoly and other graffiti artists have come up but he does it in an interesting Arabic calligraphy way with a lot of public work in places like Beirut, Paris and Cairo.

There’s a series of artists from the 1920s, 1930s Secession era that are maybe not the top-line pieces, but there are pieces from that artistic movement that are not valued in the same way.

Michael Harris

Director of Family Office & Partner, Verdence Capital Advisors

We’ve been encouraging clients to embrace an investment in infrastructure, due to its low correlation with traditional assets. There is a significant global need to refresh our legacy infrastructure like transportation — roads and bridges — while also focusing on the development of new areas in communication (transmission towers), social programs (education and healthcare) and in utilities (water, power and renewables.) In addition, the nice thing about infrastructure investments is that cash flows tend to be predictable, which can give you an alternative to fixed income in a low-yield environment.

There is a very real possibility that recent significant monetary easing by global central banks may lead to a longer period of inflation, and since infrastructure is recognized as a real asset, it may serve as an inflation hedge. We’re also attracted to the lower volatility of infrastructure returns. They don’t seem to be particularly influenced by short-term economic trends and could see tailwinds from the reopening of economies post-pandemic.

While some investors stick with the owners and operators of infrastructure, others buy cyclical companies like builders who profit from the needs of the project at large. Due to the long-term nature of many projects, there’s more opportunity in the private market, where there is less sensitivity to short-term commodity price fluctuations. If you’re comfortable locking up your capital for several years, you should be able to collect additional premium for the lack of liquidity.

A number of infrastructure sectors are poised to benefit from trends that accelerated due to Covid. Several governments have promised environmentally friendly stimulus measures. We expect continued acceleration in solar- and wind-energy generation capacity. Many private companies don’t have the money to expand geographic footprints or acquire accretive businesses that will improve efficiency or expand technological capabilities. This gap will prove beneficial to investors.

Another way to play it from Harris: I love to collect timepieces, and, speaking for myself, it has proven to be a great investment over the last 20 years. One of my favorites is a rare Rolex GMT-Master II that was a gift from my wife. It has a black/blue dial that collectors call the “Batman” because of its unique color combination. Its price has more than doubled over the last few years. I’m currently searching for a Rolex Daytona 116500LN with a black face and dial. Due to a spike in demand and the recent global supply shortage caused by the pandemic, it’s proving to be quite difficult to locate one at a reasonable price. (Editor’s note: The market rate for a secondhand Rolex Daytona 116500LN is around $33,000, according to Eric Wind, owner of pre-owned watch site Wind Vintage. The Batman watch goes for about $19,000 on the secondhand market.)

Stephanie Williams

Senior Wealth Advisor, AlphaCore Wealth Advisory

Alternative investments provide a differentiated return stream, are typically uncorrelated to stocks and bonds, and can help lower portfolio volatility. We believe now is an opportune time to allocate money to hedge funds that go both long and short, rather than just long.

The past decade has been a tough environment for long/short strategies, versus long-only strategies, because the market has moved steadily in one direction with little volatility. Stocks have often moved synchronously up and down regardless of company fundamentals, akin to a rising tide lifting all boats. This is common when going from a low valuation environment to a high valuation environment. We are starting to see signs of this changing, creating more opportunities for skilled investment managers to take advantage of a wider distribution of stock prices.

We are investing in what we believe to be one of the top long/short equity hedge funds in the world. And though I can’t name them for compliance reasons, I can explain what they’re all about. Their strategy, as they would say, “invests in the future and shorts the past.” At its core they are looking to invest in tomorrow’s FAANG stocks and short sunsetting businesses that are pegged to outdated business models. Advancements in smart transportation, wellness and digital health are some of the themes within the portfolio. Also, certain areas of the fintech world — such as the “buy now pay later” movement — are of particular interest.

What is unique about this strategy is that they maintain a robust short portfolio alongside their longs, which results in average net exposure of only 56% to the broad equity market. This means they may offer protection in the event of a market downturn and can potentially compound at a higher rate over a market cycle.

Another way to play it from Williams: As an avid snow and water skier, I’ve always had an interest in real estate and commerce in resort areas. The “work from anywhere” culture brought on by the pandemic has facilitated a major shift away from big cities and into small towns. I grew up in Northern California and have always wanted to own a home in Lake Tahoe. Lake Tahoe is unique in that it borders two states – California and Nevada. I would buy on the Nevada side, rent it out in the near term, and eventually move there to take advantage of the income tax savings.

Doris Hangartner

Founder, Doris Hangartner AG, Tiger 21 member

With so much money in the market looking for investment, I offer gems as an alternative and tangible asset class. Gems are portable, discrete and easy to store, and can hold a lot of value in a very small space. They are rare and scarce. They are uncorrelated to the markets, providing portfolio diversification. Over centuries, gems have stood the test of time, outperforming stocks.

It is the colored stones that fascinate me the most. My fine gems and jewelry company specializes in gems other than the big four of diamond, emerald, sapphire and ruby. My focus, rather, is on gems that have gained in importance more recently, such as paraibas, which are neon-bright tourmalines, tsavorites, which are a green type of garnet, and spinels, which are found alongside ruby and sapphire deposits.

Spinels are singly refractive, like diamonds and garnets — the light going into and passing through the stone emerges as a single ray. They tend to display more brilliance, transparency and shine. In doubly refractive stones light gets split into two rays, each traveling at a different speed and path. So with ruby you see two different colors — for example, red and pink — whereas the color in a spinel appears more homogenous.

In the last five years prices for good paraibas from Brazil have gone up 50%. Buyers need to go look at the paraibas in person, and in different light sources if possible. Is the color neon and vibrant? Is it a classic Brazil color or a luminous turquoise color? Nuances can mean huge price differences.

Paraibas do not photograph well, so it is even more important than with other gems to see them with your own eyes. To determine possible treatments — such as inclusions that can sometimes be filled with oil or resin — and country of origin, stones should always be tested by a reputable laboratory.

Another way to play it from Hangartner: I like to invest in earthbound long-term treasures. I’ve bought shares of a company that invests in the forest in the northern part of Sweden. The forest makes up two-thirds of the country and Sweden is the world’s second-biggest exporter of pulp, paper and sawn wood products. I’m also preparing to invest in the whiskey business, since I see similarities with rarity and scarcity as with gems — we’re taking something from the earth and humanizing it. Rare whiskey has gone up significantly over time. I'm also looking into creating NFTs of my gems and jewels.

Lane Bess

Principal of Bess Ventures and Advisory

The battles that are taking place across borders are going to be [occurring] increasingly in cyberspace. Ransomware and other cyber threats have become a big challenge to many companies, costing them millions of dollars. We all know that pushing buttons and firing missiles is a path to destruction, but there are just as damaging initiatives through cyber attacks impacting nation states and having costly impacts.

Cyber threats is an area which crosses many different industries. Recently, I'm highly interested in a category of artificial intelligence called deep learning. I liken much of the cyber security technology to Remdesivir. They're a collection of technologies and software which make best efforts to fix or protect your business and critical data. However, companies involved in artificial intelligence, in particular deep learning AI, have the potential to develop a proactive “vaccination” for the most egregious cyber-attacks.

I started my cyber journey in 2002, when the focus was on pattern-based antivirus. My next company, Palo Alto Networks, is a firewall company. The movement of applications and data to the “Cloud” led me to my next company Zscaler. In each of these cases, while improving cyber-attack security, the clever attackers found ways to evade detection. The emerging deep learning class of artificial intelligence may prove to be the most effective innovation to prevent the most aggressive and costly attacks.

I get pitched and review proposals of one to two cyber companies each week. There is a lot of good technology coming to market. If you can invest early, you're assured a good return. Even if you can't get into one of these company investments prior to an IPO, there is growth opportunity. I'm focused on innovative companies that leverage AI to improve protection from cyber attacks.

Another way to play it: An interesting space I am looking at is flying electric transportation vehicles that, much like an Uber, can transport you short distances. There are a couple companies that look interesting to me, Wisk and Joby are a couple of examples. I enjoy flying drones and if they can make these vehicles as easy and safe as flying a drone, that is an interesting market.

Leonardo Otero

Partner, Arbor Capital

From a macro standpoint, the world isn’t a very exciting place right now: You don’t have huge growth anywhere, there’s a lot of social inequality. So the real opportunity for gains lies in finding big digital businesses with fast organic growth that could benefit from a winner-takes-all strategy.

One place we’ve been looking for that is in the sport-betting sector. Sport betting was a black market in practically the entire world until 2018, when the U.S. Supreme Court paved the way to make it legal. That kicked off similar changes all around the globe, with the most recent country to legalize it being Canada.

There’s a Canadian small cap, Score Media and Gaming, which could hugely benefit in our view. Its app, theScore, is Canada’s biggest sporting media app and the third biggest in the U.S. And it’s now shifting its business model away from advertising, which has tighter margins, toward making money out of being a broker for sporting bets. If they succeed, they could see a 20-fold increase in revenues in five to seven years. It’s definitely a risky bet for $1 million, but one that could come with a nice payoff.

Another way to play: We’ve recently invested in a startup buying stakes in the rights to Brazilian hit songs that people have kind of forgotten about. The strategy is to do almost like a private equity and bring those songs back to people’s lives, be it through advertising, a Netflix documentary on the artists and so on. Brazil is still lagging behind the renaissance streaming has caused in the global music industry, but we’re betting it will catch up and artists will have a bigger share of profits, like it’s happening everywhere else.

David Root

Founder, DBR & Co.

I’m passionate about investing and about mentoring. There’s a way to do both, through something called a “search fund.” The idea behind a search fund is to back future CEOs in their search for a good company to acquire and lead for six to 10 years. It's part private equity, part venture capital. The term originated at Harvard Business School in 1984, was popularized at Stanford Graduate School of Business and has spread steadily to business schools, entrepreneurs and private investors around the world.

The way it typically works is that group of investors identify and back “searchers,” who may be newly minted MBAs, or MBAs that have been in the workforce for less than a decade. The group forms an investment vehicle, often a partnership structure. Then the B-school graduates go out and look for a privately held company, or companies, valued at $6 million to $10 million — it could be a car wash, a health company, a lifestyle company.

When successful, this has resulted in a relatively fast path for the young graduates to become an owner-CEO and attractive financial returns for both investors and searchers. A 2020 analysis by the Center for Entrepreneurial Studies at Stanford found that from 1984 through 2019, at least $1.4 billion of equity capital was invested in traditional search funds and their acquired companies, generating approximately $6.9 billion of equity value for investors and an estimated $1.8 billion for entrepreneurs so far.

The aggregate pre-tax internal rate of return for investors was 32.6% through the end of 2019, down from 33.7% in a 2018 analysis, and the return on invested capital was 5.5x, down from 6.9x in 2018. That reflected slightly lower returns, shorter hold periods, and a record number of new acquisitions. There is risk, of course: The 2020 analysis also found that one in three funds failed to buy a company, even after two years of full-time work trying to find one.

Another way to play: I love hockey. I played it, my sons played it — one of them played as a pro. I would love to invest my time and money into a minor league hockey franchise. It’s such a gritty sport and tends to not be as ego-driven as other sports can be, like basketball. There’s talk of a minor league coming to Pittsburgh. But if it doesn’t, I’d look to the Cleveland or Michigan areas.

Matthew Liebman

Founding partner, Amplius Wealth Advisors

We like the Blackrock Capital Allocation Trust, which launched as part of a sort of new generation of closed-end funds and trusts. [These funds and trusts trade like a stock or exchange-traded fund, but money doesn’t flow in or out of the fund as investors buy and sell shares.] Their original siblings had bigger up-front commissions, and we'd only buy them when they traded in the secondary market, not at the initial offering price. But BCAT has no front-end load to the client—Blackrock has financed that—so it’s a more consumer-friendly way to have permanent capital.

We’ve been watching this trust since it came out about a year ago, and it's looked particularly cheap trading in the secondary market at times so we’ve been adding to it. Effectively it's managed by Blackrock’s asset allocation team that runs their flagship fund [the $27.5 billion. Blackrock Global Asset Allocation fund]. It is a “go anywhere” fund. They have between 25% and 33% of the fund in private securities, both debt and equity. It’s like a 60% stock /40% bond fund but a more nimble one.

The trust has a nice yield of more than 5.5%, and they make some of that by writing options.. If we were going to invest in higher-yielding investments, we wanted to do it with a firm that has extensive credit experience. There is certainly risk here, but they are also getting yield from areas including dividend stocks, which are paying more than many high-yield bonds now, and they get a lot of yield from private credit, where they have the expertise to make the deals and do due diligence and get above-market yields.

So we get public market expertise and private market expertise in a reasonably cost-efficient way from an elite manager, and it’s been trading at times at a discount to its net asset value [NAV refers to the market value of the fund’s underlying assets]. At a time when there isn’t much value, if you can find something that is a little undervalued that could be a win.

Another way to play: I think the whole collectibles market now is overinflated. If you really think things are going to cost more, then do an experience now because it will cost more later. I’ve long wanted to get to all 50 states, and I’ve been delayed between responsibilities at home and work and obviously with the pandemic. I’ve been stuck at 42 states for a while, but I’m going to get up to 45 over the next couple of months. I’m taking a vacation in Colorado, where I’ve been before, but it’s not far from the four points, where four states meet, and my wife and I will go into New Mexico, where I’ve never been. My son and I will also take a baseball stadium trip and I’ll probably hit Minneapolis and states around there where I’ve never been.

Mark Watson

Founder, Aquila Capital Partners

If you look at how the economy has changed over the past decade, there’s been a slow march to digitization in just about every industry. The pandemic accelerated this and also forced consumers to engage with brands in a direct way. For some, it’s become almost a daily experience. I know people who order from Amazon every single day of the week. It’s this recurring interaction. You could say the same about Netflix. Historically, people have been pretty reluctant to buy insurance online. With the pandemic, it became a lot harder to go talk to an agent in person, so people began experimenting with digital insurers, like Lemonade or Hippo.

A lot of those companies are private and venture-backed. You can invest through venture funds, which have gotten chunks of these bigger companies then parsed them out to smaller investors or by investing in early-stage companies that are on their way to becoming a platform, then an ecosystem. That’s where I’m putting my dollars.

What I’m looking for as an investor is for the next ecosystem to be created. You want to look for companies that are constantly innovating to make the experience better for the customer every time they interact. What matters, too, is that the ecosystem is multi-sided: Various people involved find it easier to transact with each other through the company’s platform than on their own. For example, Amazon is a marketplace that allows buyers and sellers to come together and transact in a more efficient way. In a true ecosystem, both sides have to win.

Another way to play: I’ve been collecting watches for 20 years, maybe longer. And I’ve noticed that the price of a lot of secondhand watches has gone up 50% to 100% over the last couple years. A lot of people like Rolexes, especially the Submariner, which looks like a diver’s watch. You could have bought one used for $2,500 to $5,000 two years ago. That same watch today is $10,000 to $15,000. There’s an active secondhand market for Rolex, Audemars Piguet and Patek Philippe brands. If you really want to put some money to work, a Patek can be had for $20,000 all the way up to $1 million. With watches you get the benefit of an alternative asset class, collecting and enjoying it while it appreciates. They’re secondhand so they already have some wear and tear but because they’re so well made you can afford to wear them and not worry.

Michael Sonnenfeldt

Founder and Chairman, Tiger 21

Everything these days is about the transition to clean energy. It used to be very theoretical, but when you have 60 people die in Portland and hundreds in British Columbia because of the heat, it's less so. Now when people get into cars and turn on the AC and waste energy, we have to think about the lives being put at risk because of climate change.

A major focus for me is renewable power companies. In the last decade, fossil-fuel companies have gone from being 16% of publicly traded equities to under 3%. The market has understood the clean energy transition. Politicians haven’t — many people haven’t — but the people betting dollars on the future have spelled the end of fossil fuels, and anyone not thinking about that in their investment strategy is living in the past.

I’m backing startups that have unique technology to play in the power market — not just the energy market. If the last decade was about growing use of renewable energy, the next decade will be about the growing use of renewable power. That's when renewable power will tip over some minimum around 30% of the mix of power sources for utility companies. That tipping point will change the world as “on demand” renewable power increasingly replaces the base loads previously supplied to utilities by coal plants or intermittent peak power supplied by gas peaker plants.  The same energy transition will drive adoption of electric vehicles. It’s not just Tesla. There is electric vehicle-maker Lucid Motors, which will debut in the next few months. You can trade it in the Churchill SPAC (CCIV), and more broadly, you can also play in the exchange-traded funds like LIT (the Global X Lithium and Battery Tech ETF) or TAN (the solar Invesco ETF), and of course all the individual names, as well.

Another way to play: My personal investing is also about the need to go green. I don’t want to have pleasure at the expense of other people's misery. I'm putting in a new swimming pool and getting geothermal heating instead of gas. Geothermal has been free energy available for eons. Maybe it's a little more of a capital cost, but once it's installed, it's free for life. I'm putting geothermal heating in my house using the same geothermal field. I'll use more for pool heating in the summer and have it available for heating the house in the winter to use the system as efficiently as possible. I also made a massive investment in solar power on my sailboat to minimize the use of fossil fuel.

Justin Onuekwusi

Head of Retail Multi-Asset Funds, Legal & General Investment Management

Take a look at the stock market right now and it’s hard not to see a bubble is starting to form, especially in tech shares. Although we think it could continue, what happened recently on Reddit’s stock forums was really frightening. We’re looking for assets that represent solid value over time, and one sector we have a strong conviction about is infrastructure stocks: airports, railroads, toll roads, energy pipelines, and utilities.

These are bedrock stocks that demand patience from investors. But they have relatively low risk, and there are two main reasons why we think the timing is right for them now. First, as Covid-19 vaccines roll out and lockdowns end, we believe there will be a surge in economic activity. In the U.S., for instance, rising demand for goods and services will be a source of growth for railroads that carry freight. And a renewal of travel should boost airport shares, which have been seriously beaten down in the last year.

Second, infrastructure shares are at their most attractive valuations in more than a decade. Our analysis shows that the sector’s price-to-book ratio, which essentially tells you how expensive the shares are, is about 40% cheaper than equities in general. While company earnings comparisons are distorted by the pandemic, even on other measures the sector looks cheap.

The best value of all may be Japanese railways. There was a collapse in ridership, of course, last year. But there aren’t too many listed ones, and given their importance to the economy, buying the shares is a way to play the revival of the entire country. It’s possible that many of Japan’s commuters will not return as they continue to work from home but we think the market is underestimating the volume of workers that will eventually return to their offices.

Another way to play: Collectors are going bananas for vintage soccer club shirts. I’m a huge Manchester United fan and a few years ago I bought a team shirt from 1995 for £250 ($350). Now I see it for sale at £1,000. The key is finding shirts with a story behind them. That shirt was a black one that had the number and name of Eric Cantona, the French player who was sent off during a match at Crystal Palace and then proceeded to kung fu kick and punch a fan in the stands. Indeed a notorious and unfortunate incident, but it's that moment which has made the shirt more valuable. The nice thing about these assets is they tend to rise when the clubs are about to win a championship and fans want to show their love. These shirts can be found on eBay and other online auction sites.

Paul Mershon

Founder and CEO, Silverhawk Private Wealth

We see a lot of attraction in real estate for manufactured housing — or what you might call mobile home parks. It’s an area many institutions are starting to wake up to. The returns are ridiculous. Over the last decade, investors have seen appreciation as high as 600% to 700%.

When you look at the demographics, there’s logic to it. Baby boomers have had a huge economic impact during each decade of their life. Over the next 12 years, the youngest of the boomers are turning 65, so 20% of the U.S. population will be over 65. That means a high percentage of people selling homes to capture liquidity and becoming renters, or seeking lower-cost housing. A mobile home is a third of the cost of a stick-built house. The average tenure in these parks is 15 years and occupancy rates are high nationwide. Renters tend to be older, fiscally conservative and capitalized adequately and you don’t see problems with rent abatement.

There are about 50,000 of these manufactured home parks in the U.S., but there’s only been about 10 developed in the past decade. Most city councils aren’t very excited about a brand new trailer park and there are zoning restrictions so it’s pretty hard to build a new park. Those that remain dominate the space. Large investors like Zell’s Equity LifeStyle Properties and Sun Communities still only control 5-6% of the market; 95% are mom and pop operators. It’s highly fragmented. That’s the definition of opportunity for the private-equity world.

Another way to play: Investors should consider the Mercedes Benz 300 SL. These models were manufactured between 1955 and 1961 and really represent the gold standard for classic car collectibles. If the car market migrates higher, they will be some of the first to rise in value. If the market declines, these models will typically experience only about 30% to 50% of the general market decline. And the Mercedes is recognized worldwide and followed by the global collectible market, not just limited to U.S. buyers, so that serves to increase demand.

Depending on condition, they tend to sell for about $800,000 to $1,500,000 most years. We’ve seen a drop in price in the last 24 months of about 15% to 20%, as we have across the spectrum of classic-car collectibles, so this may present a great entry point assuming you can find a willing seller.

Steve MacDonald

Angel Investor and Founder, MacDonald Ventures

Angel investing in startups is a really fun and exciting area. Historically getting into one of those opportunities at that early stage would require $50,000 or $100,000, but what’s evolved over time is the idea of syndicates. There are now opportunities for lots of people to invest smaller amounts — $3,000, $5,000, $10,000 — in small companies through angel investor networks or crowdfunding platforms like SeedInvest or AngelList.

There’s a new little cottage industry of angel syndicate leads whose job it is to go out and look for early-stage companies. As they become more successful, they’re able to invest your money alongside well-known venture capitalists and oftentimes at better terms than if you’d invested directly into the VC firms. The syndicate lead will typically take a 20% to 25% carry once the company sells, but there’s no 2% administration fee and the syndicate lead does all the due diligence on deals.

The recommendation from most people who do this professionally is to make multiple, smaller investments annually. You just don’t know which one is going to be the next Uber. Hopefully you’ll get a couple breakouts and that’s where you’ll make all your returns. The time horizon is long, you really should be able to look eight to ten years down the road.

One of the really exciting things about this is that you can look for these really crazy ideas that people are building companies around. I’m invested in a company that’s building computerized virtual-reality contact lenses. It’s cutting-edge science and it’s super fun.

Another way to play: I like experiential investments. I know a lot of people who’ve bought ten to 20 homes all over the world that they go use but then they AirBnB it out to pay for it. They absolutely love it. They’re covering the cost of maintaining it, but then they’re also participating in the appreciation of the asset itself. You can go to Turks and Caicos whenever you want and then rent it out for the rest of the time and then take off and go to Rome, Madrid, Colorado or wherever. We have a house in Aspen and a local property manager who comes and maintains it and makes sure everything is ok. We only rent it once a year, for two weeks, and it literally pays for all our operating costs for the year.

Roberto Martins

Head of Global Wealth Solutions, Itau International

Our view is that the world as a whole won’t grow a lot in coming years, so the way to get attractive returns is looking for regions where growth will stand out. And for that we recommend buying stocks in emerging Asia countries outside of China. Singapore, Indonesia, Vietnam and even India are all very promising, and we’re confident that’s where growth will be.

Two themes in particular have caught our attention: The first is education. The average spending with education in the region is much higher than other emerging countries, we’re seeing world-class universities moving to Asia, but the market is still in its early years and offers a lot of opportunities for new companies. The second is finance, in particular insurance. A lot of these countries don’t have robust public social networks, so there’s room for private players and the market is still under-penetrated.

Another way to play: One of our main investing points in the world today is looking for assets with limited supply. And my favorite one is New York real estate. The pandemic brought a lot of questions, the mix of people in the city will probably shift – with billionaires moving to Florida – but I’m confident demand will still be there, with the safeguard of not having sudden supply increases. Covid also created an entry point, after years of rising prices; I won’t risk saying when prices will go back to climbing the way they were before the pandemic, but if you’re a good negotiator and patient, it’s a good moment. In a time when rates worldwide will remain close to zero, it’s the kind of investment that gives you 6-8% return above inflation that you can also boost through leverage.

Claire Madden

Managing Partner, Connection Capital

We recently invested in a fund in the deep-tech sector. We often think about capitalizing on changes relating to consumers when people talk about tech, but this area is business-to-business where there’s a whole load of things going on in the background with companies. Many banks, for example, have evolved the online interfaces customers can see, but they’re operating off creaking infrastructure behind the scenes. Deep-tech companies in this space are setting up infrastructures that sit on a cloud-based system, making them a lot more scalable.

None of these changes are visible to the consumer, but they help to manage whole processes for institutions across all sorts of areas, including a lot of regulatory and compliance work. So it’s a very interesting space to get into. To get exposure, you do need to know the right fund managers.

Another way to play: I’ve always been fascinated by the economics of the music industry — plus I’ve often thought it would be great to be part of a fund that owns the back catalogue of all your music heroes. Royalties can give very strong and predictable revenue streams, but it’s not just about buying an asset and letting the money roll in. We’ve talked to a manager in the past where they take a very active role in buying songs and then doing something, like making them the music of a TV ad, and that can just catapult. We’ve all been there thinking, “I really like the song in that ad,” and then you find yourself searching for it — and the song ends up in your music playlist. So it’s all quite connected if you’re proactive.

Andrei Ivanov

Partner, Leon Family Office

In a world where people drive electric vehicles and have solar-powered homes, we will produce and consume energy in a very different way than in the past. The current centralized network that connects large power plants with consumers is being replaced by a complex, computer-driven network with small producers and consumers of energy. The network will be able to adjust the flow of energy on demand, thus increasing efficiency.

Operating this network requires complex algorithms and huge battery capacities to store energy. This is a new market with huge long-term potential, because a comprehensive solution will solve the problem of unpredictability of energy sources based on wind power or sunlight. Around $1.2 trillion in new revenue opportunities for integrated storage is expected to be deployed by 2040, according to Bloomberg New Energy Finance estimates.

I would invest in shares of companies that already use artificial intelligence for optimization of energy flows and storage. For example, Stem, which recently became public via a SPAC merger with Star Peak Energy Transition Corp.  I like that Stem has both energy storage and IT solutions on single platform and its IT revenue is based on  subscription model with long term contracts. Wood Mackenzie Energy Storage Service expects that capacity of installed batteries will grow 25 times over the next 10 years globally. That promises exponential growth in market capitalization for market leaders.

Another way to play: I believe that the U.S. online sports betting industry is at the beginning of a big growth cycle. A federal ban on such betting was lifted in 2018, and JP Morgan estimates that the market will grow from $1.1 billion to $9.2 billion over the next 5 years. Classic casinos were completely closed during the pandemic. People had no place to go but to online bookmakers, which led to exponential revenue growth in this segment. The most promising business model is the combination of streaming sports events and betting on them, which FuboTV is now actively developing. The industry has already caught the attention of investors after Michael Jordan became a shareholder and advisor at DraftKings.

Eric Becker

Founder and Co-Chairman, Cresset

I’d put that $1 million into industrial real estate. Occupancy in data centers has almost doubled over the past year. We’ve all been doing so many Zoom calls, and Zoom is hosted in the cloud. There’s been a tremendous surge in demand.

Then on the physical side, there’s been an explosion in e-commerce. The pandemic has caused supply-chain disruption, and research shows companies are looking to increase inventory 5% to 10% to weather the storm. For a reserve stock increase of even just 5%, they’ll need the equivalent of 700 million to 1 billion square feet of industrial distribution space to hold it all.

For every $1 billion in e-commerce revenue, there’s demand for 1.25 million square feet of additional distribution space. The increase in inventory is a one-time thing, but there will still be a huge expansion in demand. If we see an annual 20% e-commerce growth rate, that’s an additional 400 million square feet of distribution space needed over five years. We think it’s a wonderful opportunity.

Another way to play: I would consider starting a dinosaur fossil collection. After the $31.8 million auction of Stan the T. Rex, we are seeing art collecting expand to include ancient artifacts. My interest in paleontology goes back to when my mom took me to Calvert Cliffs State Park in Maryland as a child, where we found fossilized shark teeth and mollusks. I have shared that interest with our two sons, and we even planned a family vacation where you can join in with archaeologists to help with the digging.

John Pantekidis

Chief Investment Officer, TwinFocus

Never in my lifetime have I seen a period when so many business models die and become antiquated and new ones come up. It has sped up this Darwinian cleansing that started two decades ago. Many of the real opportunistic investments will be the ones being ironed out and negotiated in the hallways of bankruptcy courts.

In the U.K., we’re looking to buy the senior secured debt of a REIT that owns one of the top trophy retail malls in the country. If the underlying real estate is sold at a certain price level, we will achieve a very compelling return — over 20% net IRR — in a very short period of time for taking on a very measured amount of risk.

Right now the valuation is about a third of what it was three years ago. We believe these trophy commercial and office properties can eventually sell for as much as 70% to 80% of their previous valuations, at which point they become very compelling, assuming the buyer can add value by redeveloping it and adapting for potential new types of use.

We like to partner with bankruptcy attorneys and investment bankers who’ve been doing this for a long time. The distressed space is going to be a very exciting place over the next three to five years. Now there’s a lot of stuff in bankruptcy court that should stay in bankruptcy court and you should absolutely avoid, but there are going to be diamonds in the rough. You can make double, triple, quadruple what you’d make in the public markets over a very short period of time.

Another way to play: We know that taxes are likely going higher, especially if there’s a Blue Wave or even if we just see a Democratic president in the U.S. So we predict there’s going to be a lot more wealthy people moving to no-income tax states. I’d look at high-end real estate in Florida. Use some prudent leverage to buy it and you know it’s going to do well over time. In Europe, I’d pick a Greek island. Greece went through some very hard times over the past decade, but we think it’s in recovery. The current prime minister is doing the right things to attract capital and has been a huge catalyst for change. I’d be looking at some of the islands or the nice coastal areas. A lot of Germans, Scandinavians and British are buying as they view Greece as the new French Riviera.

Ray Tam

Co-Founder and Managing Partner, Raffles Family Office

Attention now is on how much to allocate to debt. Before Covid-19, markets expected quantitative easing and stimulus spending to gradually ease off — but of course due to the pandemic, stimulus remains important.

Asian investment-grade debt, fixed income and China’s real estate bonds are areas we look at. Within China real estate, we think the economy there is going well and modernization remains a force for pushing it forward. It’s very difficult to name one company because things happen so fast. Our view is that it remains important to be diversified. If you bet on one name then, of course, you can get scared.

Covid-19 had a smaller impact on growth in China than it did in other countries, and we’re seeing the recovery there is quite impressive. If you’re going into the debt market, you’re looking for stability and also at which governments have the strength and support to maintain markets should another Covid-like shock hit. Those are reasons why China makes the list. Another is that debt issuance remains common — China debt issuance accounts for 70% to 80% of total Asian debt issuance, there are prospects for expansion and there’s support from the government, too.

Another way to play: I’d definitely go to Chinese contemporary art. You have the traditional painters in China that remain very popular — just look at the popularity of Zhang Daqian in recent years. Younger generations from Asia often study in the West but back home they want to find something good that represents their culture too. And they want to be able to offer that thing to their friends, which is where art can help. The really interesting thing about modern artists is that they’re still alive. That means it’s easier to verify real works of art and to weed out potential fakes.

Akshay Shah

CIO and Founder, Kyma Capital

An e-bike is functional, clean and a staunch adherent of social-distancing norms, even as the world returns to a new normal. It lets you move around without getting in an Uber or on a train, and is more compliant with ESG than your friendly neighborhood mutual fund. If like me, you’ve added a few pounds over lockdown, it can even serve as part of a daily exercise routine.

The pandemic has accelerated a makeover of our cities, with the U.K. alone spending billion of pounds to develop thousands of miles of “cycle lanes.” If you want to get on the electric bandwagon for a few thousand dollars, you could buy a MATE, a Danish e-bike with thick tires and Moncler branding. If you wanted to invest the $1 million and help reimagine mobility, invest in the common equity of an e-bike company.

The investment thesis in companies behind e-bikes is straightforward. Buyers are willing to pay upfront and wait a few months for delivery. This creates a very favorable working capital dynamic. Production is typically outsourced to a major manufacturer, with direct shipping to many of the largest markets. A typical e-bike sells for $2,000 to $3,000 with gross margins in excess of 50%. Surplus cash flow is invested in marketing, which combines with organic influencers, and prominent celebrities like Kendall Jenner, Nigel Sylvester and Will Smith (in the case of MATE) promoting the bike.

Another way to play: When businesses go bust, they leave behind reminders of the fragility of corporate power and the effects of time. Branded items tied to them become sought after as a reminder of the past. EBay sellers have been able to scoop up branded items and sell them at a pretty substantial multiple after a suitable passage of time — like the $500 Lehman sticky notes. A diversified pool of memorabilia across several different corporate failures can be attractive, though such items are not monetizable over a short period. The key to success here would be volume of products and being patient — after all, you’re chasing an illiquidity premium.

Dany Roizman

Founding Partner, Brainvest Wealth Management

I’d invest in real estate and specifically multifamily apartments. People will always need a place to live and not everyone can afford to buy a house, so there’s opportunity in rental-only buildings. What we’ve seen in the pandemic is that people are looking to move to less-crowded cities, driving demand for houses in those places. There’s also the fact companies in the U.S. have been moving headquarters to the Sun Belt area, another factor driving demand and opening new opportunities. We’ve seen rents go up 1.2% year to date, as vacancies have fallen.

I’d split half of the money in the U.S., where this market is more developed, and half in markets where it’s starting to grow, like Ireland, Spain, Portugal and Italy. Millennials are usually looking to rent, not buy real estate, which helps the multifamily business. In the U.S., 10-year returns in dollars could be about 10% to 12% per year.

Another way to play: The pandemic created a huge opportunity to invest in the sale and leaseback of airplanes. We stuck with smaller, one-aisle planes, because contrary to what’s happening with intercontinental flights, local ones are recovering. And thanks to lenders pulling back, we had the chance to strike deals with big air carriers, which had a better chance of surviving, like EasyJet and Lufthansa, charging about 15% to 20% per year and having the plane as collateral.

David J. La Placa

CEO and Founder, Intellectus Partners

Focusing on the innovation cycle of a company or sector is the way to invest these days because that’s where the alpha comes from. Much like the fintech sector boomed after the banking crisis, we think there’ll be a similar boom in health care coming out of the Covid crisis.

Biotech is seeing some of the biggest benefits of computing technology and AI converging to find and develop new drugs and therapies faster. It cost about $3.5 billion to $4 billion to develop a traditional drug and get it to market, but using AI can cut costs and speed the process up significantly. We think cancer is a particular area of interest. One deal that’s been in the news lately is the acquisition by Illumina, a gene-sequencing company, of a firm called Grail. They acquired them for their liquid biopsy technology, which, if it works, will allow people to determine whether they have cancer by drawing blood. It might even be able to tell them where the cancer is located instead of having to do biopsies, which can be pretty invasive.

The individual stock investing side here can be fraught with risks, especially in biotech, because you can have massive volatility if a company doesn’t get their drug approved by the FDA. But there are some large biotech ETFs out there that are very liquid and really good investments. There are also dedicated mutual funds that we think are particularly good.

Another way to play: One area we’re very excited about is space. There’s a massive investment opportunity in the next decade or so — probably $1.5 trillion by 2030 — in terms of potential space-related revenue. There are more opportunities in launch, which is what SpaceX is famous for. As satellites get smaller and more powerful, the number being launched will continue to proliferate. So that means that there will be more of them up in the sky that can listen to and see more than they could in the past, at much lower price points.

Peter Fitzgerald

Chief investment officer for multi-asset strategy, Aviva Investors Global Services Ltd.

Gold is always popular in a crisis. There’s something comforting about knowing your cash is safely invested in a metal that’s been valuable for millennia and isn’t that correlated with the broader securities markets. With central banks printing so much money and flooding economies with liquidity to cushion the pandemic, gold is a great hedge against the debasement of currencies, including the U.S. dollar.

The problem with gold is how do you come up with a reliable way to value it? There’s no cash flow, no earnings, no fundamentals to analyze. It doesn’t throw off income like a dividend, which is another challenge. Gold is an investor’s Disneyland – a magic kingdom that you have to believe in to enjoy.

Yet for all the unknowns, gold performs really well over the long term. In the last five years, the metal has returned 11% annually compared with the S&P 500 Index’s 11.5%, so you’re getting profits as well as peace of mind. Exchange-traded funds make it easy and affordable to invest in the commodity. Investors should steer clear of ETFs that aren’t backed by the physical metal itself. You want that extra security of knowing there’s bullion in a vault supporting the fund’s price.

Another way to play: If you are looking for a decorrelated asset that’s literally a safe haven consider farmland. Over the long term, cities will continue to thrive but they could be in for a difficult period the next few years if we don’t get a vaccine for Covid-19. Farmland offers a place where you can fall back to if things get bad. It’s also an investment that could appreciate if central banks continue to pump out cash to help the global economy, which could trigger asset inflation.

Nilson Teixeira

Chief investment officer, Macro Capital

The unprecedented, extreme liquidity central banks have been pumping in the economy will go on for a while, which means you could have significant returns investing only in major stock indexes. Holding equities only isn’t a big problem as long as you can make it into a big umbrella with global, solid names.

I’m Brazilian and an emerging markets investor, so I’d weigh my portfolio a little more to Asian stocks ex-Japan through exchange-traded funds, followed by U.S. stock indexes, like the Nasdaq 100 and the Russell 200. There’s still a high degree of uncertainty in the coming months, we’re still in the brave new world of the pandemic, but I’m optimistic at some point we will have a reliable treatment for the virus and a vaccine, with prices as whole responding well to that.

It will take central banks a while before starting raising rates, so you’d have a perfect environment for growth. Even gold will react well to all the liquidity, so it would be another asset to carry.

Emerging markets as a whole tend to perform better in this scenario, but for Brazil specifically it comes with a lot of uncertainties. The country is trapped in a state of mediocre growth and just had a lost decade. It’s a place for more of a short-term allocation, especially companies tied to commodities like iron-ore producer Vale or meat-packer JBS.

But sadly, in the longer run, both Brazil and Mexico have worse growth outlooks than Asia, due to their political, educational and institutional issues.

Another way to play: I’ve been collecting Brazilian art for more than 20 years, so that would be my go to. Brazilian female artists from previous generations, like sculptor Liuba Wolf, still fetch lower prices than male artists just because they’re women. This is a gap I see closing. And today, given all the conversation on ESG and on Brazil’s environmental issues, works from photographer Claudia Andujar, who pictured native Brazilians, and her peers, will gain even more importance.

Shirley Crystal Chua

Founder and group chief executive officer, Golden Equator

While almost all asset prices declined during the initial phase of the pandemic, ESG (Environmental, Social and Governance) investments did better than most. Sustainability-driven Denmark has been the best performing stock market in the world in 2020, by a wide margin.

We’re placing more emphasis on companies, stocks, bonds and funds that achieve social, environmental and financial objectives and we’re targeting investments that help the economy while also aiding development goals such as cleaner environments, better governance, safer products and better and more inclusive growth and employment practices. We expect this trend to accelerate as sustainability becomes the central investment philosophy for more private capital.

The second area we’re looking at closely is technology. Many companies have benefited from the new normal of virtual interactions and working from home, such as B2B enterprise software that enables people to work remotely. These new behavioral patterns have also accelerated the adoption and development of digital-first economies.

We’ve seen strong growth in sectors like social and mobile entertainment – live streaming, social & live commerce, gaming, influencer marketing, as well as in food delivery, food science, digital health and education, in both developed and emerging economies. With more people being pushed to take part in the digital economy, business models that deliver essential services and products online, especially for the above sectors, will continue to see strong growth. We’re monitoring our own portfolio of companies, including Singapore-based influencer agency Gushcloud and live-streaming and social-entertainment company M17 Entertainment.

Another way to play: I’ve always been interested in wine investments. Prices of Burgundy wines have climbed steadily in the last 20 years, but it’s a complex playing field. I have participated in the Hospices de Beaune Charity Wine Auction in the past few years, organized by Christie’s auction house. The proceeds benefit the hospital and the bottles can be a unique and original gift with custom labels. The 2019 Bordeaux En Primeur release is another good addition to have this year with some at an approximately 30% discount to the 2018 vintage. Other than seeing it as a steady long-term investment with low correlation to equities and commodities, it is also a pleasure to consume the bottles produced by the most patient and nurturing growers and wine makers.

Hans Olsen

Chief investment officer, Fiduciary Trust

If I already had a diversified portfolio and I came into $1 million I’d be thinking about real estate outside of some of the class A cities. This is part of the Covid rethink. If you do not want to be based in a city center and you’re reimagining your work and personal life, then real estate outside of some of those city centers starts to make a lot of sense, especially if you have a family. I’d be thinking 90 minutes to two hours outside of say, Boston or New York.

I’m looking at buying a piece of property up in midcoast Maine near the water. As populations begin to spread out and people think about how to reorder their commercial lives, places like this where you have a great deal of natural beauty, a really lovely quality of life and real estate prices that are still quite reasonable give an opportunity and provide a long-term option for that type of capital.

You get the benefit of enjoying it while it compounds for you. Unlike with so many asset classes, this is something you could actually use and create some memories.

Another way to play: Go out and restore some old Land Rovers, the early Defender or pre-Defender series models. I love doing this, it’s actually a passion of mine. You can buy one, restore it and have so much fun while making money. I’d think about buying late 60s or early 70s vintage Land Rovers in tough shape. The cost depends on where you buy it, I got mine for around $5,000. You could easily put $25,000 to $30,000 into restoration – or do it yourself if you’re handy – and then you can sell them nicely restored for $50,000 to $70,000. They don’t make them anymore so there’s a scarcity value. These old Landies were built so that you could take them apart and put them back together with a screwdriver and wrench set, yet they have a following that’s near legendary. It’s drivable art. I bought mine off Craigslist about eight years ago. I could probably double my money on it but in the meantime I can throw my dogs in the back and have a great time.

Stan Young

Managing director and senior client advisor, Rockefeller Capital Management

What a lot of people forget is that the fixed-income market is actually a huge mosaic of opportunities. It’s by far the biggest asset class. What the Federal Reserve is doing is aggressively buying fixed-income securities and keeping yields low, but the Fed can’t buy everything. They’re focusing on investment-grade securities and what they can buy in the liquid securities markets. There are still dislocations in private fixed-income securities and that's where things get interesting and there’s an unusual return potential versus the risk.

Some investors will be forced to sell because of various constraints out there. These securities can include asset-backed bonds, real-estate and structured debt, the types of things that are not everyday investment-grade securities, but are more unusual investments held by hedge funds and REITs, family offices and the people that do more esoteric stuff. These are private funds and that’s not something that everybody can get into.

Categories of less-liquid fixed-income securities include corporate and consumer loans, real estate bridge loans, aircraft leasing and small business lending. There are securities backed by specific assets, such as bonds backed by a mixture of jets or a group of apartment buildings.

Another way to play: I am a numismatist. I enjoy it because it allows me to have a personal experience with a piece of history. After enjoying U.S. coins for many years, I branched out into ancient and world coins. The cost of these coins for similar dates and quality is dramatically less than for U.S. coins. Coins become oxidized with time. In special cases, this oxidation can be colorful. We call this oxidation toning and it can make a coin look like a painting. I specialize in these coins. Over the last 30-40 years, third-party grading services have come to dominate the market. This process essentially “securitizes” a coin and values have compounded nicely. There are some coins that cost $1 million or more each, but anyone can buy gorgeous coins from $1,000 to $50,000 each.

Mike Novogratz

Chief executive officer, Galaxy Investment Partners

I’d invest in the gaming space. You think about the metaverse – the concept of a virtual universe that will blend virtual and augmented realities and link them with the physical world -- and the gaming world. When 5G happens and we have games that you can play in the cloud, that space will be transformative over the next five years. For an investor, that’s mostly played through venture capital.

I have a venture fund that invests in this, and it’s mostly venture companies building to operate in this space. The virtual world and the real world are going to merge in the next five to 10 years. This is really a five-year or 10-year bet and a really fascinating one. You have to do lots of little bets because you’re not sure who exactly will win. But if you gave me a million that in 10 years could be worth tons and tons of money, then that’s one place I’d put it.

Another way to play: My passion is throwing great parties. I put people in competitions with each other during the day and have great bands at night. Right now, if I had a small party, I’d have Christone “Kingfish” Ingram play. He’s a 21-year-old blues player who is probably one of the best guitarists in the world. If I want to impress people because you gave me a million, The Killers in a small place would be awesome. I like getting bands where people know the words to the songs. When every single person knows every word, you get that beautiful communal spirit of the anthem. So maybe I’d get a band like Coldplay.

Bill Street

Group chief investment officer, Quintet Private Bank

The abnormality of the shock has discounted valuations more deeply than anything we’ve seen in past crises. With so much uncertainty there’s been a significant repricing across assets. But the policy response from central banks and governments has been enormous, and as painful as the shock has been there are signs that we could have a rebound and see a huge amount of pent-up demand for goods and services.

Before the crisis we were heavily positioned to take advantage of the technological revolution in traditional manufacturing, especially in the automaking industry. We still hold those positions. The impact of renewable energy in transportation is a huge growth trend that is only going to intensify, only now the value of those stocks have been indiscriminately discounted. 

We’re invested in companies that make battery technology, software and  digitalization tools for manufacturers. The climate debate hasn’t gone away and it will rage again. When we do come out of this crisis, transportation will just be the tip of the iceberg. I think manufacturing in general will undergo another revolution. 

To that end, we also like copper, which has also been incredibly discounted. Copper is used in all forms of industrial manufacturing and it is integral to the global supply chain. As economies open up and coronavirus infection rates fall, demand for copper is going to pick up, perhaps even to the levels of 2017 and 2018, which is about 30% higher than where it is today.

Another way to play: It may sound a little unusual, but food waste is a good investment. Restaurants and cafes throw out tons of unpurchased food every day that could be redistributed to the needy. And we have the technology to make that happen. Apps from companies such as Karma and Too Good To Go link consumers to eateries to prevent food from going into the bin. Investors are accelerating the trend by taking stakes in these ventures, helping the planet and business efficiency simultaneously. While restaurants have been shut by the pandemic, they’ll be back. 

Clara Bullrich

Partner at Alvarium Investments and co-founder of TheVentureCity

A behavioral change is taking place, and digital adoption across all industries has been hugely accelerated by the pandemic. Areas in tech I’d focus on include productivity tools, health care, entertainment, education, cybersecurity and anything having to do with touch-less, human-less technology.

Remote working will grow exponentially in functionality and importance, and play out positively for productivity tools that help people organize and track work such as Slack, Clockify, Zokri and Pocket. It will also use more cloud services, and that will increase the risk of information getting to the wrong actors. Zoom recently had problems with perpetrators hacking into conferences. So cybersecurity solutions will be heavily in demand. We already see open-source video conferencing platform Jitsi growing because of Covid-19.

I also think about cybersecurity in a social surveillance sense — knowing when and where groups of people are moving. As we get out of lockdown, people will accept the data-gathering in return for being able to be social again. It will take time for people to adjust to going to events, so at-home entertainment will continue to surge, and devices like smart glasses and virtual reality and augmented reality will become increasingly popular. 

Demand for telemedicine services such as Teladoc, Everlywell and Nurx is soaring. Clinics and hospitals are being forced to implement telemedicine at a faster rate. We’ve been reviewing Steady Health, which has a wireless monitoring system for diabetes care. Eventually we could see insurance companies demanding the use of such devices to track conditions.

Another way to play: I collect art and am very involved in the field. One of my favorite contemporary artists is Diego Singh. I have two paintings of his hung in places where I spend a lot of time -- the office and my kids’ playroom. I’d buy another. His paintings were $10,000 to $13,000 when I bought my first one, and now they cost around $60,000.

Jack Ablin

Chief investment officer, Cresset

I would invest $1 million in private equity secondaries, a strategy that provides liquidity to limited partners who want out.

Investing in traditional private equity funds requires an enormous amount of capital to get adequate diversification among different industries and different vintage years. And if you invest in pools, you can’t pick and choose what you’re buying. Each of these limited partnerships ramp up for a period of 12 to 18 months and are held for five to 10 years. That’s a long time.

Buyers of secondaries pretty much have full visibility into what they’re getting because the funds have been in place for a few years. As my colleague Scott Conners, head of Cresset’s private equity division, says, generally the lemons will ripen before the cherries. If something’s going to go bad, it usually does so quickly. 

Right now, there’s an enormous liquidity premium and cash has a much bigger advantage than in previous months and years. If a limited partner faces a capital call that they can’t or don’t want to make, they might turn to a secondaries buyer to exit the investment. Industries that perhaps are looking troubled in the near term could trade at a sizable discount. There are PE funds that focus on entertainment and dining, a whole sector of the economy that’s pretty much been put on ice. That may prompt limited partners to just bail.

Secondaries’ returns over the years have been compelling, but with today’s liquidity premium they’re a table-pounding opportunity. 

Another way to play: My passion is baseball, particularly the stats and history of the game. Baseball scorecards and player cards got me interested in math and statistics as a kid.  I would buy up baseball memorabilia, particularly from the Chicago Cubs. I have a completed scorecard from the Cubs World Series win in Cleveland, a signed Ron Santo photograph, a Fergie Jenkins signed bag and a few signed baseballs. Sam Stovall sent me a Cubs team card a few years ago. Baseball memorabilia can fetch stupendous prices. A 1952 Mickey Mantle card sold for $2.88 million recently on Heritage auctions, while one of Babe Ruth’s jerseys was auctioned last June for $5.64 million, a record for a piece of sports memorabilia.

Jeremy Larner

Art dealer and founder of JKL Worldwide

I’m selling off younger artists and buying blue-chip art. When things go back to normal, some of the emerging artists may no longer be in fashion. Blue chip artists, though, will continue to stand the test of time. How many Gustons are out there? How many Lichtensteins? It’s harder and harder to find these works. Things will normalize soon and I think people will continue to want great art.

I have two undeniably good deals in front of me that I’m trying to close. One of the works is about 20% discounted and my offer is 25% below that. Why are the prices so reduced? The seller needs money. I can make at least $500,000 on each of these deals. I have $10 million to $15 million to spend on opportunities.

I just sold about a dozen emerging-art works, with prices ranging from $20,000 to $250,000. That included several works on paper by Ghanaian artist Amoako Boafo for $75,000 to $150,000 that I bought directly from the artist for $10,000 each. With that money, I am only interested in buying blue-chip artists like Joan Mitchell, Cecily Brown and Christopher Wool that I know I can resell at a profit. I’d rather spend $1.5 million on an artwork than $60,000. It’s a safer bet.

Another way to play: I might buy a house in the Hamptons, although I wouldn’t consider it an investment. If we just want to get out of the city and let the kids run around, the Hamptons are my No. 1 choice. It would be a $3 million house, though. We’re not planning to use it in the summer because we have a place in Hawaii. People pay $150,000 to $200,000 for a season in the Hamptons, starting from Memorial Day. If we decided to rent it out, it would pay for itself and then some.

Bruce Lee

Founder of Keebeck Wealth Management

In a post-Covid world, social distancing will be a theme and that has to mean tech. And people don’t like getting bitten twice, so health care will also be a major theme.

Apple, Google, Microsoft and Nvidia, which are being recognized in value now, will continue evolving and getting bigger. When 37% of people can work outside the office, home offices will explode, so anything having to do with furniture, computers and telecommunications will explode. The demand for companies like Verizon and AT&T will increase as we need more data, more bandwidth.

Covid has proven that the U.S. Food and Drug Administration can evolve with pharma companies in a pandemic, so maybe some restructuring there can take place to allow for more of a partnership. The market has been educated that pandemics cost a lot of money. Assume that the cost of not being prepared for this one is between $7 trillion and $10 trillion in future earnings and losses of jobs worldwide. I think global coordination in becoming more aware of these issues will be an investment theme that will last for quite a while.

Lastly, pet ownership will continue to rise. As we think about social distancing, we need that contact. It’s why you’re seeing a surge in Chewy Inc. stock. People are ordering pet food online but because you love your pet you won’t just buy everything on Amazon—you want to consult with someone, and Chewy does that.

When I look at life pre- versus post-Covid, I want things that will help get my freedoms back, because in the past month those been taken away from me, and tech and health care and my pets will get me through it. 

Another way to play: I own a lot of art and memorabilia, including 30 of the biggest mobster’s signatures. I have a penchant for wine and just got rid of a huge collection. I own too much. So in the new Covid world, educational resources are going to be tightened and I’d love to find ways to offer kids education in arts and music. I genuinely love music and art and I’d love to give kids access to that.

Jeffrey Gitterman

Co-founding partner, Gitterman Wealth Management

Water, sustainable infrastructure and climate-screened real estate as well as waste management and recycling are our top themes. We’re hyper-focused on climate right now.

I absolutely believe over the next few years in asset management all we’re going to be talking about is artificial intelligence, blockchain and climate, and the intersection of those things. For example, investment in blockchain in tracking fisheries and the ocean environment is super-interesting right now, because people are going to get more concerned about that.

In the Fiji they are already relocating 43 communities because of climate change, and they are starting to use blockchain to track illegal fishing because of damage to the reefs and fish stocks and the economy. They’re issuing blue bonds — borrowing to fund projects that help the marine environment — for the first time this year. We’re going to see this new wave of climate awareness — even President Trump now is saying that climate change is not a hoax. The Australian fires are indicative of what is going to be top of people’s minds this decade. Between Greta Thunberg and all the kids, this is not going away.

On the high end, we’re going long water and desalinization and short water projects that don’t address the infrastructure. Investment firm Water Asset Management runs a strategy we are following closely. We don’t have any choice — our infrastructure is falling apart, so being thoughtful about that and doing that sustainably is going to be one of the biggest stories of the decade.

We also want to be short mortgage exposure to high-risk climate areas in flood zones. Moody’s just bought California-based climate risk analytics company Four Twenty Seven. We’re going to see the un-priced premium of climate risk in mortgages start to get priced in, so you have an opportunity in the market right now to be really picky about your bond portfolio.

On the private side, we’re seeing one incredible idea after another on both sides of recycling and waste management —  how to create packaging more sustainably and how to recycle it. Companies such as circular economy investor Closed Loop Partners and recycling specialist TerraCycle are going to take off. Big companies are going to be facing pressure on how to create products that make them look better.

Another way to play: California wines are actually a really good investment as wildfires grow. There is risk going forward that the pricing gets out of whack. Luckily a lot of the vineyards have escaped damage, but that’s really a temporary thing. In the last few fires, Sonoma got decimated. In Australia the vineyards are more and more at risk, so owning wine right now as the production gets more limited is a great investment.

Kathlyn Tan

Director, Rumah Group

Responsible investing has always been a mainstay at our family office, but with the environmental crisis escalating, breaking out of our comfort zone of equity and property has never felt so meaningful. What’s looking extremely exciting is the alternative-protein space. It’s a rapidly growing ecosystem changing the way food is produced by offering earth- and animal-friendly alternatives to meat lovers.

Alternative proteins are already disrupting the food industry. With increased awareness of the crippling effect of meat production on the environment, as well as increasing concerns around the impacts of factory farming on human health and animal welfare, consumer habits are gradually shifting and making the case for business investment.

From low-tech and high-tech plant-based meats that actually taste and feel like meat, to cultured meat (real meat grown without animals), to protein from microalgae — one has a diverse menu of opportunities to choose from. If these alternatives are able to compete on flavor, texture and convenience then scale and time have the potential to reveal investments that will perform on a global level.

As an avid scuba diver and freediver, my pick is cultivated seafood. Not only is seafood a less mature market segment, but it also offers an avenue to address overfishing — a grave threat to the ocean. Depending on your risk appetite and the players involved, one might consider backing an alternative protein start-up like Singapore-based Shiok Meats Pte., or perhaps a venture accelerator fund like Big Idea Ventures. Regardless of how you choose to invest, having a clear strategy to diversify your portfolio and manage risk is key. The international non-profit organization Good Food Institute is a good place to find out more — their team compiles industry reports, white space opportunities and other resources for investors.

Another way to play: My primary objective is to ensure that our family is climate positive over our lifetime and investing in carbon sinks is one way to manage our carbon footprint while keeping assets on our balance sheet. I’ve been researching blue carbon ecosystems, where mangrove forests, seagrass meadows and tidal marshes capture and hold large amounts of carbon in plants and sediment. Protecting blue carbon ecosystems also offers other benefits such as supporting healthy fisheries; providing livelihoods for locals; improving water quality; as well as protecting coasts from storm surges and erosion. If not blue carbon, a reforestation project in an emerging economy where biodiversity can be promoted and excess carbon credits can be sold would be my pick. Organizations such as Conservation International and New Zealand-based Ekos help create bespoke carbon projects to meet investor needs.

Michael Sonnenfeldt

Founder and chairman of Tiger 21; Chairman, MUUS & Co.

The ocean offers a virtually unlimited source of renewable energy. Our family’s private investment company, MUUS & Co., is committed to deploying capital for sustainable energy producers and next-generation technologies that will shape the future of energy. We are currently investing in proven technology developed to produce energy from the power contained within ocean waves.

Ocean technology offers the chance to power floating computer centers with the added benefit of free cooling provided by the seas — eliminating two of the growing sources of carbon emissions (the power for the computers, and the power needed to cool the computer centers to allow the computers to function properly). The same ocean wave-produced energy can be used to power seaborne floating factories that produce low-cost renewable fuels, nutrient-dense food and minerals. The potential of harnessing carbon-free energy from the ocean is boundless and positioned to be a major clean power source in the future.

Investments like these have extraordinary risks, because this is a very early stage technology. Even the best ideas can fail from any number of problems a small company will encounter along the way to commercializing a new and bold technology. There are a few public companies that have tried to use the power of the waves to light buoys and for other uses, but we believe this new technology approach we are investing in has far greater potential in the future.

My family office is investing with another family office that also focuses on carbon-free power solutions. Our strategy was to provide seed funding, based on our assessment of the enormous potential and the team behind a company in this area, and then wait for larger entities, with deeper scientific capability and deeper experience in bringing new technologies to market to validate the initial findings and concept.

We have to be realistic about the risks and size our investment accordingly. Typically, even with a very high degree of excitement, it would be wise to keep allocations to investments like this to well under 1% of overall assets, and maybe aggregate 10 or 20 such investments in a separate portfolio that probably, in total, remains well under 10% of a well-balanced portfolio.

Another way to play: I’ve been collecting handmade Japanese dolls (Ningyo) for many years. For centuries, the Japanese have been creating intricate and extraordinary Ningyo that can be as much as 1 meter tall. These are museum-quality dolls that can be 300 years old, made of ceramics, with eggshell faces and some of the most beautiful materials for their kimonos. In Japan these dolls have a long tradition for the Boys’ and Girls’ Day holidays. After World War II, the Boys’ Day dolls fell out of fashion and exceptional pieces could be acquired at relatively moderate prices. The better antique dolls are quite rare and can be worth up to $100,000 or more. When displayed, they can take the viewer’s breath away.

Nick Henderson

Portfolio Manager in the Responsible Global Equities team, BMO Global Asset Management

For a long time, we have not invested in solar despite the fact that it’s growing fast. We just don’t have enough confidence in the quality of companies to justify it. The low barriers to entry have, for the main, allowed further competition into the market, driving down pricing and, in turn, profitability.

That said, we are still benefitting from the rapid deployment of energy in renewable resources and one company we like is Orsted. This is an interesting one because it used to be Danish Oil and Natural Gas. Starting a decade ago, the company reoriented away from fossil fuels and embraced the development and maintenance of offshore wind farms. It already holds a quarter of the global market in offshore wind and provides power to about 9.5 million people. Its target is 30 million by 2025.

We are also taking a look at suppliers to wind farm operators, particularly those providing turbine blades. One name we are watching is Vestas Wind Systems, a Danish company that makes wind turbines. We haven’t invested yet because of the potential for increased competition, which in the past has undermined prices and reduced profitability. If there is a shakeout in the space we would likely have a more positive outlook.

What we really like to see in the wind sector is how much capacity a company has coming online. Orsted is currently producing 5.6 gigawatts of electricity but it has 15 gigawatts in development. While the company is already offshore in Europe, it’s made acquisitions in the U.S. that could be a springboard for growth in that market. Naturally, you’re going to get some pushback from local communities but they tend to have a lot more to say about onshore wind farms than offshore ones. So based on Orsted’s record and what they’re bringing to market we have confidence it should continue to win further bids and grow profitability. And there will be regulatory pressure globally for more energy from renewable sources so that provides a tailwind for Orsted.

Another way to play: In my time away from the office I’m a beekeeper. I manage two hives at my family’s home in west London with about 60,000 bees. I’m also a member of a local beekeeping association where we talk things through. Recently we’ve been working together to prepare for the Asian hornet, which has come across from France and can rapidly annihilate entire beehives. With colony collapse disorder and issues around pollination, I feel this is a way to support local ecology. Beekeeping also helps me think about issues around pesticides and farming practices that impact local biodiversity, and we engage with our portfolio companies on those issues. Every summer my bees do pay a dividend — a load of honey.

Laurence Lien

Co-chairman and CEO, Asia Philanthropy Circle;  Chairman, the Lien Foundation

We have often been told to reduce, reuse and recycle, in that order of priority. We can agree to that, but we still cannot stop waste production completely. In fact, changing people’s behaviors is especially hard. So waste volumes continue to rise, and existing methods of waste management and recycling are woefully inadequate to address the growing mountain of trash.

It is hence critical to invest in new technologies for solid waste value capture that substantially reduce the effort to sort and clean products, while at the same time result in much higher-value end products.

Imagine one integrated engineering technique that effectively treats unsorted waste — combining biological treatment methods to remove organic waste first, and then a mixture of thermal and chemical techniques to turn carbon-based waste into fuel oil, high-value carbon-based materials and valuable gases, and re-utilizing the minimal resultant ash and slag in construction materials. The value of the outputs must significantly exceed the cost of production and must be easy to scale close to the source of the feedstock. I think we are much closer to such a breakthrough today and I would invest $1 million towards such an effort, in collaboration with other funders.

Another way to play: I am invested in an impact fund, called Garden Impact, which has a sustainable development theme, and a sub-focus on researching and commercializing sustainable construction materials. There are many great ideas but a lack of top-notch entrepreneurs to grow them. So I am going upstream to be more hands-on to help identify, develop and mentor promising social entrepreneurs to take on much more ambitious efforts. This would have a much great impact than passively investing.

Garvin Jabusch

Co-founder and Chief Investment Officer of Green Alpha Advisors

We want to buy companies that own intellectual property that will help create a more sustainable global economy. This is where all of the very competitive returns will come from over the next decade or two.

In transportation, we see declines in internal combustion sales and rapid uptake of electric-vehicle sales worldwide. Tesla led the charge, but now it’s the automakers, and startups are falling all over themselves to grow the EV market. You have municipalities and governments saying they’ll ban internal combustion, if not just diesel, in the next 10 years.

So we look up and down the value chain of everything that provides electrified transportation. That means companies that own intellectual property in battery tech, drivetrain tech, cooling technology and charging structure, including rapid charging via superconductivity technology — almost anything associated there could be a good growth area.

And what about risks from the degradation of water and farmland? New gene-editing technologies could be really important here. Why is Midwest farmland being largely degraded and denuded to the point where they have to fertilize it within an inch of its life to grow crops? It’s way too much use of herbicides and pesticides. This is still early, but various firms are working on making crops and plants pest-resistant, or drought-resistant, or higher in nutrients, by editing their genome.

If your crops are naturally resistant, you don’t need the chemicals. We want exposure to owners of the intellectual property empowering all of that, so own Crispr Therapeutics, Editas Medicine, Intellia Therapeutics and a couple others.

Another way to play: I love comic books. I have a pretty large collection and the value is mostly unrealized. On paper it’s appreciated a lot since I started collecting as a kid in the late 1970s. I did really well buying a couple editions of Ghost Rider #1. He’s one of the less famous ones in the Marvel pantheon. I scored a couple of those six years ago for about $15 each in near-mint condition. Now the price guide says they’re worth around $450. I’m also way up on the “What If…?” stories. These are alternate time line books, like what if Spiderman joined the Fantastic Four? They haven’t been in movies yet so the world is largely unaware of them. But Disney’s streaming service is going to launch an animated “What If…?” series in 2021, and then people will start buying the books.

Nancy Pfund

Founder and Managing Partner at DBL Partners

Investing in funds that focus on green solutions or companies already delivering solutions can de-risk your portfolio, build a corporate sector that addresses the climate crisis, and allow your assets to grow in harmony with the future.

High-net-worth investors can join angel networks like Powerhouse in Oakland, California, Cyclotron Road at University of California Berkeley, or Prime Coalition, a group out of Cambridge, Massachusetts, that works on early-stage investing. People like to use venture funds like ours as a platform for co-investing – they can see the companies and then, if they want, invest directly in future rounds. Expected returns are the same as for other types of venture capital investments. 

We use a ‘trifecta’ to analyze which sectors to invest in to optimize for returns and sustainability. First, we follow the carbon. Next, we want to fix something that’s broken and really move the needle. Finally, if we look at a sector and the iconic names are 100 years old or more, it’s time to invest.

This leads us to transportation and energy, which are no-brainers. It also leads us to less obvious places, like food and agriculture. This sector generates some 30% of carbon and about 4 out of 10 people on this planet work in it. We just did an investment in Bellwether Coffee, which has a more sustainable method of roasting coffee, and Apeel Sciences, which uses a plant-based coating to keep food fresh for longer. I also like the agricultural data and analytics platform company Farmers Business Network, now in its pre-IPO round.

The circular economy — which aims to minimize waste and use of natural resources — is another appealing sector. We just had an IPO with The RealReal, which started as aspirational fashion but by the time it went public, the circular economy was a key theme for investors and customers. There’s a Los Angeles company, For Days, where you can buy organic clothing and send items back any time to be recycled and swapped for new ones at a very low cost. A company called Yerdle acts as the back office for companies like Patagonia and Eileen Fisher for recycling and resale.

Another way to play:  I have always been a fan of the circular economy and am always game for an antique show, an antique barn or an auction. Old French and English porcelain, silver, furniture and such — things most millennials have little interest in — those are some of my favorites to collect. I also have a pretty good collection of Oscar de la Renta apparel, which I kept from my earliest career days.

Martin Hermann

Chief Executive Officer of BrightNight Energy and member of Tiger 21

It’s no secret the future of electric energy is renewables. The cost of constructing and operating large-scale solar-power plants has reached the point where they can provide energy at a cheaper cost to consumers than traditional coal and natural gas generation.

There is huge investment potential in being part of the global shift in the energy industry. We see increasing political pressure as citizens demand the long-term promises of switching to renewables become an urgent reality. This pressure will unseat traditional power players and lead to new power-development firms, technology companies, battery-storage providers and manufacturers.

I’ve invested in the renewable space for 10 years, and right now I’d invest $1 million in operating assets. Today the industry deploys large solar-power plants using advanced designs, including mounting systems that allow panels to track the sun, artificial intelligence to guide optimal decisions in production, design and grid routing that will make solar energy available through the night and maintain grid stability, and advanced technology to produce more electricity from every panel. Combining all that at scale will bring down the costs of electricity for the retail consumer. 

One option is to invest alongside institutional funds, which are selling holdings in thermal coal-related investments and looking for sustainable investments that are environmentally and socially responsible. Other ways to invest include funding private renewable project developers. It’s difficult to gain direct exposure to these firms, though, and sorting through the heap to find winners is essential. As projects finish construction and begin operations, they’re sold to large investors looking for a diversified portfolio of long-term stable cash flows. Most major private equity funds offer opportunities to invest here. 

Public developers historically focused on natural gas and coal are switching quickly to renewables and battery storage.  Brookfield Renewable Partners, for example, is quickly adding wind, solar and storage assets to its base of hydroelectric facilities, increasing capacity by 21% from June, 2018, to this June. Firms like Finland’s Wärtsilä and Spain’s Iberdrola are working to make renewable energy and battery storage a reality. Software and data providers who support this development are an area to watch. 

Another way to play: When looking at overseas real estate, Italy is a good value, and Tuscany in particular. The peak of the Italian real estate market was in 2009, and since then prices have been declining or remained flat. One property I’ve shortlisted has more than 30 acres of land, which I’d convert to organic farming. Conservation laws, which apply to most historic buildings in Tuscany, increase the potential upside as supply of new construction is very limited. I expect to rent it out for $10,000 to $20,000 per week and look forward to enjoying it personally as well.

Jennifer Kenning

Chief Executive Officer and co-founder at Align Impact

Resource efficiency is often overlooked as an important solution to climate change. Everyone’s focused on LEED buildings, and the reality is we have a ton of buildings and infrastructure that needs to be overhauled— commercial buildings, universities, schools. We have estimated deferred maintenance issues in the U.S. alone approaching $2 trillion, with 70% of that in municipalities, universities, schools and hospitals.

Heating and cooling systems are a huge issue. As people in developing economies migrate from rural areas to cities, they want to emulate how the U.S. and Europe developed and have air conditioning and refrigeration. Air conditioning emits super-potent greenhouse gases — hydrofluorocarbons. You hear about ventures to turn waste into jet fuel, and people focus on that because it sounds sexy, but the reality is there are bigger economic opportunities in our buildings and infrastructure. 

The challenges are that the market is very fragmented. Building owners aren’t incentivized to make capital improvements, but are starting to see the cost of environmental issues. If you invest in an infrastructure fund you get diversification and can look across state-of-the-art opportunities including replacements for cooling and heating systems, efficiency solutions like LED lighting, building automation systems, smart thermostats, smart glass, and so on.

You can also get a nice income stream of 8%, plus the appreciation. From where we are in the market cycle, it’s super-attractive to investors. This is basically project-financing in a middle market that’s starved for capital. A lot of banks won’t touch projects that are less than $250 million, and a lot of attractive projects are in the $50 million to $100 million range, where an infrastructure fund could invest.

There are lots of ways to ways to invest in infrastructure upgrades while earning decent returns — multiple funds, direct opportunities, debt-financing opportunities. Examples of managers and businesses trying to tackle this opportunity include Denver’s 361 Capital, and in terms of a direct investment, Carbon Lighthouse in San Francisco. 

Another way to play: I’m really into live music, and I’ve seen Dave Matthews play many, many times. I attend events in arenas and stadiums, and it’s staggering that we still use plastic cups in these venues. More than 4.3 billion disposable plastic and compostable cups are thrown away each year at live events in North America. Less than 20% get recycled or composted. So my personal investment would be in r.CUP. I’m also an avid reader and can see the value in collecting original old books and the appeal they’ll have over the next decade because we’ve gone to such a technological environment. 

Casey Clark

Director of ESG Research & Engagement, Rockefeller Asset Management

There’s an opportunity to focus on businesses that provide solutions to mitigate the impacts of global warming. That could be small-to-mid cap companies in environmental sectors like water infrastructure and technology, energy efficiency, waste management and climate-support systems.

Water will be one of the predominant means through which the impact of climate changes will be felt, and technology solutions are needed for climate adaptation. In sustainable agriculture, how do you more efficiently harvest and irrigate crops? There is some cool technology out there that pinpoints smaller amounts of water in very specific places, rather than blasting water over a whole farm, for example.

Big industrial companies that supply machinery to farmers are thinking about how to provide water more efficiently. You can find companies offering a wide range of water-technology solutions, including equipment for transport and for the processing, utilization and metering of water. 

For climate-support solutions, there are engineering and consulting firms that may be attractive. Attaining an environmental assessment is often the first step for states, governments and municipalities to understand the impact of climate change. Coastal cities such as Boston, New York and Miami have retained consulting firms to assess physical risks resulting from climate change such as flooding and rising sea levels, and to provide resiliency plans to protect high-valued real estate.

Waste management is often overlooked, but is a fascinating industry driven by four things. There’s a desire by companies to increase brand loyalty, particularly with Next-Gen customers, and there’s realization of cost savings, the decision by China to no longer import the world’s plastic waste and changing perceptions about the negative ramifications of that waste. By 2050, it is estimated that plastic will outweigh fish in the ocean.

We think a lot about what firms are positioned to increase the use of tech and automation to optimize waste management in a burgeoning circular economy. Under this environmental theme, there are companies in areas like waste technology equipment, recycling and value-added waste processing, dealing with hazardous waste and general waste management, and firms that are diversified across that entire value chain. 

Another way to play: Hand-engraved maps created centuries ago fascinate me. They offer a rare combination of science, historical significance and artistic expression. A 2010 Christie’s auction showcased Abel Buell’s 1784 map of the U.S. Created six months after the Treaty of Paris, it was the first map of the United States published in America and the first map printed in America to show the U.S. flag. Only seven copies are known to exist. Christie’s estimated its value at $500,000 to $700,000. It sold for more than $2 million. 

Kevin Philip

Managing Director, Bel Air Investment Advisors

To invest in the “E” part of ESG, or Environmental, Social and Governance investing, I’d encourage investors to think outside the box. Buying exchange-traded funds that track the space is the first approach for many people, while buying individual green-energy companies might be the second. The challenge with emerging industries is that it’s often very hard to predict the winners. The current landscape of green-energy companies may not even include the future leaders. Some of the best research is happening in conglomerates like IBM, GE and Honeywell, yet buying their stock would only give you a fraction of exposure to the space.

Some of the best materials to absorb sunlight, for example, may not even be invented yet. As quantum computing becomes a reality, the first area it is likely to affect, after cybersecurity, will be materials. New liquids, fabrics, compounds built with the assistance of quantum computing may end up being the best way to capture solar energy or desalinate water.

Investors will find a higher likelihood of success sooner by investing in companies providing services to green energy companies and projects. For example, public companies that produce environmental-impact studies for green projects, material companies that produce the concrete and components for the construction needs, and the larger tech companies doing the most research would make for a diversified approach to green investing across three different sectors: services, materials and technology. 

I personally don’t believe in green investing as a way to earn outsized returns. It’s too narrow a subset. If someone has ethical concerns about aligning their investments, we can apply a menu of screens to index investing, including animal welfare, labor-rights controversies, private prisons, tobacco and controversial weapons. The underlying portfolio will still be a well-balanced mix of stocks and bonds. If a client wants to address problematic symptoms of climate change, I advise them to donate to charities focused on that area, be it oceans, deforestation, flooding or famine. That’s more effective than trying to identify the company that will create ‘the fix.’

Another way to play: I absolutely love high-saturation oil paintings and am fortunate to have a couple at home by two living artists: Kenton Nelson and Raimonds Staprans. I encourage investors to stretch or wait to buy a singular, exceptional piece, instead of several minor pieces along the way. In art, emerging artists are extremely speculative; I’d buy one emerging artist piece for every four blue-chip established pieces. I strongly encourage high-net-worth collectors to use advisers to help curate. A piece is made more valuable by who has owned it and which institutions traffic in that artist’s market.  

—With assistance from Emily Chasan

This story is part of Covering Climate Now, a global collaboration of more than 220 news outlets to highlight climate change.

Thorne Perkin

President of Papamarkou Wellner Asset Management

We’ve invested for many years with a real estate group called Tavros, and they’ve been good at getting ahead of the curve in terms of New York neighborhoods. They were early investors in Fifth Avenue south, before the Flatiron district got hot, and bought a corner of 14th Street and 9th Avenue years ago in the Meatpacking District that has become perhaps the hippest area in New York City.

They’re investing in Long Island City and were there well before Amazon announced, and then abandoned, its plans to create a corporate campus there. New York, and certainly, Long Island City, would be better off if Amazon had come and stayed, but Amazon could have chosen to go anywhere in the world and it chose Long Island City, which is a massive brand stamp of approval.

We like the neighborhood for a lot of reasons. What everyone complains about in New York is transportation, and the area has spectacular transportation. It’s so close to Manhattan but relatively inexpensive to live there. There are multiple subway lines that go to Long Island City, and you can take a train to Brooklyn and Manhattan without needing to transfer. It has great schools, tons of cultural institutions and beautiful waterfront parks that are just buzzing.

Maybe we’re in the third inning of how the neighborhood develops. In the condo market there’s still limited supply. It’s been a very hot submarket over the past couple of years and for all the reasons I’ve mentioned, it will only pick up speed. If you use a million to buy a condo, well, you’ll do well over the long term, and it’s an amazing place to live.

Another way to play: I’ve played guitar and sung almost all of my life, including some live performing through the years. For me, rock guitarists don’t get more versatile, memorable or iconic than Eric Clapton. To own one of his guitars would be a dream, and it would only appreciate in value. In 1999 Clapton auctioned off 100 of his guitars, raising about $5 million for his rehabilitation charity, the Crossroads Centre. The top lot was a 1956 Fender Stratocaster he named “Brownie,” which he used extensively on stage in the ‘70s. It sold for $497,500. In 2004, another of Clapton’s guitars, “Blackie,” sold at a Christie’s auction for $959,500, also to benefit his Crossroads charity.

Alan Higgins

Chief Investment Officer at Coutts & Co.

Investors are still scarred from the crash 10 years ago and by the multiple corrections in the stock market since. As a result, we believe global equities are increasingly under-owned and underappreciated. Many investors are sitting on the sidelines, while companies and sovereign wealth funds continue to buy equities. This is why this year is known as the flowless rally—markets are up but there have been substantial outflows this year from active equities and exchange-traded funds. We like equities as a source of income, and in fact global dividends have increased more than 30% over the last five years.

A less-mainstream idea is that investors have overcompensated for two things: default risk and liquidity risk. One way to play on that sentiment is to invest in collateralized loan obligations, or CLOs. Remember them from the hangover of 2008-09? These are pools of corporate loans that banks securitize and sell to investors. The securitized market became quite controversial when the U.S. government had to bail out the banks and AIG after certain structured financial products worsened the mortgage crash. Well, too many people have seen “The Big Short,” and they believe the whole of the asset-backed market was a disaster. CLOs were marked down in 2008-09, but the defaults were not en masse. Overall the CLO market is a much more robust asset class than is widely perceived. Internal rates of return are now running at 10% to 14% annually, depending on the vintage.

To get exposure, you can buy anything from AAA-rated bonds to CLO equity, which is the riskiest tranche. Mr. Market moves the values of these instruments around, but what we like is that at the end of the day the return is determined by defaults. Defaults do happen, and Federal Reserve officials and the Bank of England have expressed concern about weakening standards in the loan market that enables CLOs, especially for borrowers with weak credit ratings. Yet for us, this is the purest compensation for taking default risk. The overall average default rate for CLOs is 0.09% and the average change in credit quality has been positive since 2011. So we see the returns going against the trend of the idea that CLOs are a disaster waiting to happen. Instead investors should look at the data.

Another way to play: Attending the best matches at Wimbledon is one of the most coveted tickets in all of sport. So imagine the prospect of owning a pair of Centre Court seats for every day of the tennis tournament for five years, plus the ability to resell those tickets for big profits. You can do this by purchasing Wimbledon debentures, which are essentially the rights to tickets for club-level seats, right outside the Royal Box. The next series, covering 2021 to 2025, are for sale at 80,000 pounds ($101,000) each, and there are only about 2,500 Centre Court debentures available. The last batch, with a face value of 50,000 pounds, is now worth about 120,000 pounds on the secondary market. Our clients typically consider these as a passion investment whereby they may attend some matches, sell valuable days such as the men’s semi-finals, and donate some tickets to charity. I’ve put my money where my mouth is and applied for the latest round from the All England Lawn Tennis & Croquet Club.

Michael Tiedemann

Chief Executive Officer at Tiedemann Advisors

From a pure investment and tax-transfer point of view, we think U.S. opportunity zones are extraordinarily interesting. It’s a terrific, well-intended investment plan, offered, really, by the Internal Revenue Service to help spur economic development in historically under-invested areas.

If you look at the forward return of the S&P 500, most would forecast 6% to 8%. The potential internal rates of return for opportunity zones are in the low double digits, and they are massively tax advantageous in a way that the S&P 500 isn’t.

If you own a single stock that has appreciated greatly over 20 years, say, from a 5% position to 20%, and you want to bring your exposure down, you calculate your capital gain, and opportunity zones let you transfer 100% of that gain into a real estate investment that will have a projected return higher than the broad market. Right now, we are reducing risk within our equity assets, so it’s good timing for us that we can defer or eliminate some of the embedded capital gains tax, but it is a 10-year holding period.

The opportunity zones across the U.S. are without question unequal in terms of appeal. You want to be a first mover, and there may be periods in coming years when it’s not as attractive as you model it out. In two to four years, as many of these areas receive a lot of investment, it will likely get more expensive. That’s the fly in the ointment.

The opportunity zones where we are initially investing for clients are in Cincinnati, Baltimore and Miami. Two of those are construction from the ground up; the other is acquiring and redeveloping existing infrastructure.

The other way to play: I’m interested in the intersection of technology and sports. If you look at how much focus and effort and energy and money goes into high-school and grade-school sports, it’s staggering. I have a small holding in Keemotion, which has automated video-production systems for capturing sports events. I also invested in K-Motion, which has developed a very thin vest with sensors that judge your range of motion, provide data and help you self-correct. It started in the golf industry, but has moved into baseball. These sorts of companies have technology that can be commercialized for professional leagues and scouts, but their application could be very broad and made affordable to the masses, maybe through a subscription.

Would I pay $100 a year to see a game my kids were playing in—live—while I’m sitting at work? You bet I would.

Carter Reum

Co-founder at M13 and member of Tiger 21

In a world getting ever more complex, hectic and interconnected, the need to find time to simplify and disconnect is more important than ever. We know tools and practices like meditation make a difference—but it’s also really hard to get that right. Technology has now become an overlay on nearly every product and category, so I’m very excited to see some of the new technologies and companies that help people do meditation more seamlessly.

The U.S. meditation market is projected to increase to $2.1 billion from $1.2 billion over the next four years, with growth primarily driven by digital apps. Meditation is growing in prevalence, with about 35 million American adults meditating in 2017, according to the Centers for Disease Control and Prevention. Even practice by children has increased, rising from 0.6% in 2012 to 5.4% in 2017.

Brands like Headspace and Calm have each grown to more than 1 million paid subscribers, and companies like Wave Meditation create culturally relevant, music-driven experiences that remind me of the early stages before yoga became mainstream. The easier and more enjoyable the experience is—more like a music app than a meditation app—the more people will be able to participate. If Wave or someone else can build a platform around brand, content, software, music and hardware, I can easily envision the next Peloton emerging. Habits build early, and the practice becomes regular—and that opens up adjacent opportunities in the space, including lifestyle, accessories and technology.

One thing you can count on as an investor is that the world is going to get more stressful. So tools to help people cope with that reality and live in a happier and healthier way are always attractive bets.

Another way to play: Many of my friends are art collectors, and I followed their lead, especially after joining the board of the Los Angeles County Museum of Art. I’ve enjoyed getting to understand the value of collecting traditional art, from an aesthetic and monetary perspective, but recently started to focus on investing in what my brother and business partner Courtney calls “the new art”—crystals. He said his crystal collection brought him more joy than his “regular” art, and he believes crystals have unique powers. This initially seemed crazy to me, but there’s evidence for their impact on well-being, and I’m becoming aware of the real, burgeoning market for crystals, especially ones of larger size and limited supply, which can cost upward of $100,000.

Mark Perry

Managing Director at Wilshire Private Markets

Today’s low-interest-rate environment has driven investors into increasingly risky assets in search of yield. Capital supply has outpaced capital demand in more “traditional” investment instruments, bringing lower expected returns and higher risk in the most commoditized market segments. Fortunately, opportunistic private markets enable an array of solutions that provide investors with the return that they demand, while enhancing their ability to diversify risk.

Two strategies that exemplify this are litigation finance and franchise-restaurant lending.

Litigation finance has existed for years in the form of third-party financial support to litigants in exchange for a share of any financial recovery from the lawsuit. One preferred means of accessing this strategy is more of a credit approach, where highly structured loans are originated to plaintiffs, law firms, or other related legal businesses collateralized by litigation-linked assets and legal fees. By securing loans against pools of pre- and post-settlement litigation outcomes, these credit strategies seek to avoid the binary risk inherent in other segments of the litigation-finance market. The set of specialty finance groups making such loans is relatively small, resulting in a pocket of market inefficiency that enables the potential for outsized returns.

A similar void in “traditional” capital markets has been targeted by groups that provide structured financing to fast-food restaurant franchisees. The quick-service and fast-casual restaurant segments are characterized by simple, formulaic business models that, by virtue of their low price point, have historically proven to be cyclically resilient while benefiting from secular trends in consumer behavior and technological innovation. Specialized groups that target this growing, fragmented segment of the restaurant space can find potential value.

While neither of these strategies is risk-free, the risk bears little correlation to the broader markets and other types of yield-focused investments.

Another way to play: A creative way to access uncorrelated returns is by investing in the future earnings of minor league baseball players. This involves purchasing equity “shares” in a player in exchange for a percentage of that player’s future earnings. Such a strategy is particularly well-suited to baseball, compared with other sports, given its rich quantitative data set. The risk, though venture-like in its binary nature, is balanced by outsized return potential.

Mark Mobius

Founder of Mobius Capital Partners

When I first started investing in emerging markets in 1987, they accounted for just 5 percent of global market cap, and today it’s about 40 percent. Our funds could only invest in six markets, and today it’s about 70. That makes diversification so much easier. Now is the time to buy in emerging markets, where we are seeing a terrific recovery.

Brazil is up 40 percent from its bottom, but there is still upside as every sector is going to benefit from a reform-minded government. There is a sea change in the whole political environment in the wake of scandals still being prosecuted. Take Petrobras, one of the world’s largest oil and gas companies, which is changing its whole system top-to-bottom to ensure corruption won’t happen. All companies are aware of corporate governance and making sure they are on the up-and-up. This is very positive for foreign investors. With more law and order, the consumer sector will do particularly well.

If you like technical analysis, many of the markets had a double bottom. There are still low price-to-earnings and price-to-book ratios. PE valuations in Russia are only five times; that’s below even Pakistan. The Russian market looks very, very cheap.

Based on fundamentals, we like the consumer-oriented companies in India, whose economy is looking to 8 or 9 percent growth. Software is big in India, and we like medium-sized companies in traditional industries adopting internet solutions. India’s byzantine distribution system is changing dramatically because of technology, tax reforms and the elimination of tariffs between states within the country. Despite the challenges facing them, Amazon and Walmart are forcing local companies to raise their game.

There are a lot of bad loans at big banks, and the government will bail them out and recapitalize them. That’s going to weigh on the currency. We are going to see a weakening in the rupee because of the coming election and the necessity for the ruling BJP to give farmers goodies. But this weakening is temporary, and the central bank has been good in terms of stabilizing the currency over time. I would put 30 percent of emerging markets money in India.

We also are looking at winners from the China-U.S. trade war. Vietnam stands to gain as manufacturing is relocating there from southern China. The same is true elsewhere in Southeast Asia. Mexico, which reached a trade deal with the U.S. and Canada last year, is also a beneficiary. Global trade is like a big balloon: Push one place, it goes out in another.

In completely bombed-out countries like Turkey, there will always be opportunities. The losers are the guys in debt. Those not heavily in debt will be winners, get market share and make acquisitions. It is still a manufacturing powerhouse that sells to Europe. The Turkish lira falling 70 percent is excessive. Things will be more stable and maybe have some upside potential.

The other way to play: My alternative investment idea is old bond certificates, for which there is a small but passionate following. I like the ones that capture a moment in history. For example, during the U.S. Civil War the North issued two-year interest-bearing notes with a coupon rate of 6 percent in 1861 and a face value of $50. One sold in August at an auction of part of the Joel R. Anderson Collection of U.S. Paper Money for $1.02 million, more than double its pre-sale high estimate.

Sarah Heller

Master of Wine at Heller Beverage Consultancy

As global warming produces hotter temperatures and more severe weather patterns, the wine industry is particularly vulnerable. Parts of California and Australia are particularly threatened, forcing growers to look for cooler climes by planting at higher altitudes or on cooler coastal-influenced sites, but fire risk and soil salinization are further challenges.

Because of its unique climate, New Zealand looks set for a slightly smoother ride. Not only are its summers cooler, but its vineyards’ proximity to the sea (the farthest point inland is only about 120 kilometers from the Pacific Ocean to the east and the Tasman Sea to the west) will help temper the effects of climate change. The closer you are to the water, the stronger the moderating effect of the ocean.

At the same time, New Zealand is trying to upgrade more of its wine production from ready-to-consume bottlings to fine wines that have longevity in the bottle and command a premium. A handful of wineries have started producing premium sauvignon blancs, but the potential for higher-end chardonnay is just starting to be explored on a larger scale.

In 30 to 50 years, both Australia and California may have limited sites available for the production of top cool-climate chardonnay, which is steadily gaining in popularity worldwide. Thus, I would advise picking up New Zealand land not currently under cultivation, or currently considered marginal because it’s too cool or up on hillsides.

Despite New Zealand’s 2017 law that restricts foreign investment in real estate, it is still possible to buy up to five hectares (12.4 acres) of land at a time if it is designated for horticulture. A typical parcel of unplanted land of that size, located on the fringes of top wine-producing regions Hawkes Bay and Marlborough, might only cost you $250,000. For another $750,000, you could plant and cover a few years of farming and contract wine-making costs.

Remember that Le Montrachet, the world’s most expensive cool climate chardonnay that sells for as much as $8,000 a bottle, is produced by Domaine de la Romanee Conti on just 0.68 hectares. The land I propose is far enough from urban areas that you won’t have to compete with real estate developers to buy it.

The other way to play: I love vintage fashion, especially timeless creations by Emilio Pucci from the 1970s that still look contemporary today. While you might find one of his dresses for a few thousand dollars online, celebrity clothing can go for a whole lot more. The Hubert de Givenchy black satin evening gown Audrey Hepburn wore in the film "Breakfast at Tiffany’s" sold for 467,200 pounds ($609,000) at Christie’s in 2006. A one-of-a-kind piece like this tends to appreciate.

Anthony Roth

Chief Investment Officer, Wilmington Trust

We’re getting to the point where distressed-debt investing will become very active. We’ll start to see some companies have a tough time refinancing debt, and that’s when some private equity firms use a loan-to-own strategy. They originate loans with terms that allow them to convert the debt into equity if a company defaults. The strategy returned 15 to 20 percent historically.

An opportunity we offered clients recently was a fund that buys nonperforming loans held by European banks. It’s politically very difficult for banks to foreclose on loans, which range from residential mortgages to debt secured by factory equipment. In many cases, the borrower ceased paying interest due to financial stress, but also knows the bank won’t foreclose.

A private equity firm can buy loans at 60 to 70 cents on the dollar and immediately say to the borrower: “Pay me or I’ll foreclose.” Usually, borrowers buy the loan back at 95 to 98 cents on the dollar. Net returns could be high teens. Clients had to make a $250,000 minimum investment and be qualified purchasers with at least $5 million in other investments.

You wouldn’t want to get into this right before a major economic downturn in Europe, but a relatively run-of-the-mill recession wouldn’t be a big deal. In many cases, loans are bought and sold within 12 to 18 months, so a PE firm can have a good feel for the economic outlook when they buy them.

The other way to play: I collect the furniture of Sam Maloof, one of the primary exponents of American mid-century modern furniture. His hand-crafted pieces use beautiful wood joined without nails or metal. He’s best known for his rocking chairs. The White House arts and crafts collection has one, and so does the Metropolitan Museum of Art. I think his low-back armchairs are actually more beautiful, and are incredibly elegant. They sell for around $15,000 to $20,000.

JD Montgomery

Managing Director at Canterbury Consulting

One of my themes for this year is the future of food. People are caring more about what they’re eating and putting in their bodies, so I’m looking at food startups.

Investing in tech startups can be very capital-intensive, and it takes a long time to build something that’s very scalable. “Instant overnight successes" only took 10 years! But investing in food startups is different. The big consumer packaged-goods brands don’t innovate very effectively, so they’re looking to pick up new brands. Venture capital firm Obvious Ventures has outlined five forces driving food companies it funds: Products need to be accessible, organic, plant-based, local and fresh—though a single product may not hit all five.

There are two ways to get exposure to this trend. You could either invest in venture funds like Collaborative Fund or Obvious that have allocations to consumer brands, or you can try to invest directly, like I’ve done. I’ve found that once you discover one brand, more start coming out of the woodwork.

These new companies are able to compete against established brands either by selling through Amazon.com or going direct to the consumer through companies like Shopify and Ordergroove. They don’t have to buy all the equipment necessary to make their products; they can subcontract that out to external facilities. And you can get almost-free advertising these days by using influencers.

One of the nice things is that you don’t need a tremendous amount of capital to invest—from $100,000 to $500,000 per brand—and the time required to build a scalable business is much shorter than for other startups. Valuations might be $3 million to $10 million at seed and angel fundraising stages. Big brands are keen to pay $100 million to $200 million, or even more. It’s a nice return on capital, and I’d rather have people eat great, clean products instead of sugary, chemical-filled products.

The other way to play: My recommendation is esports, and I’d play it two ways. I’d spend 40 percent of my $1 million investing in picks and shovels—game-agnostic infrastructure that supports gaming. Some clients and I just made an allocation to a company called Discord, a chat platform for gaming with over 200 million users. The other 60 percent I’d distribute among three teams. Interesting names include Cloud9, 100 Thieves and Seoul Dynasty. The most valuable team, Cloud9, is worth $310 million, but you can access smaller teams at a much lower cost. There are also funds you can invest with. Ultimately I believe there will be tokenization and distributed ownership of these teams. The size of the industry already is incredible to me, and we’re just getting started.

Norman Villamin

Chief Investment Officer, Private Banking, Union Bancaire Privee

Whenever investors think about growth, Japan rarely comes to mind. It’s easy to see why: The real estate bust of the 1980s left the economy stagnant for decades, and big Japanese corporations didn’t have the dynamism of their counterparts in the U.S. But Japanese society is being reshaped by something new—the unprecedented entry of women into the workforce. Almost 53 percent of Japan’s labor force was female last year.

This reminds me of the big changes in the U.S. labor market in the 1970s, when the decline of manufacturing in the Midwest, wage stagnation and unemployment drove women to go out and get jobs. All that extra income stimulated the American economy, and I believe the same thing is going to happen in Japan. Think about all the ways this shift will reverberate in the economy: Families will need more child care, women will have to buy more workplace apparel and households will even eat out more when both spouses are super-busy at work.

So I’m advising clients to play this megatrend by unearthing small and mid-cap stocks that can rapidly grow as these changes unfold. That includes employment agencies that provide temporary, part-time and permanent workers, apparel makers and retail enterprises that cater to working women, and restaurant and leisure activity enterprises that thrive on discretionary income. I know it sounds hard to believe, but Japan—a market that’s so often overlooked—may finally be exciting, if you know where to look.

The other way to play: Music royalties are a really nice way to capture yield in a low-interest-rate world, and the best part is that this investment doesn’t move in lockstep with the rest of the fixed-income world. Music royalties move to the, ahem, beat of their own drummer. This isn’t exactly a new asset class; back in the late ‘90s, David Bowie issued bonds backed by revenue from his music. Investors have been buying publishing rights to hit song catalogs for ages. What’s different now is that investors don’t have to buy Lennon & McCartney tunes.

With the advent of streaming and the explosion of shows on Netflix and Amazon in need of soundtracks, even obscure songs can produce returns. There are investment trusts that buy the songs of platinum-selling artists and breathe new life into them in ads, TV and film. You can also buy song rights from the composers, rather than the recorded music. If you’d rather go it alone, you can bid for music rights put up for sale by their owners on online music exchanges that have emerged in recent years.

Darrin Woo

Director of Woo Hon Fai Group

Because of my family background—my grandfather founded Lee Cheong Gold Dealers in Hong Kong in 1950—I believe in the physicality of gold. I would buy a million dollars’ worth of bullion bars and stuff them under my mattress. Gold has underperformed the S&P 500 index for the past five years. SPX has delivered 46 percent in that time, and gold has lost 1 percent. In the next 10 years gold is one of the best contrarian plays. I say buy when no one else does.

I also like the idea of digital tokens backed by physical gold. If you talk to millennials, they aren’t interested in buying stocks and don’t even have brokerage accounts, and they can’t afford real estate. So they are looking for a store of value that’s also convenient. They are interested in new technology and blockchain and using a digital wallet. But unlike Bitcoin and Ether, whose prices trade wildly, gold-backed tokens have an intrinsic value and should be a lot less volatile. I’ve participated in an early round of funding in Santa Clara-based Emergent Technologies Holdings, a company which is creating the world’s first digital token called G-Coin backed by gold produced in accordance with World Gold Council and Responsible Jewellery Council standards. The resulting gold can be tracked from mine to vault using blockchain.

The other way to play: I’m also a classic car collector. For the past several years nearly everything has appreciated but don’t be fooled by a rising tide lifting all boats. Like stocks, blue chips will fare best in a downturn. That means focusing on investment-grade cars that are rare but not too rare and will hold their value. For $1 million and change you can pick up a Mercedes Benz 300SL Gullwing. Only 1,400 were ever made between 1954 and 1957. But remember, unlike other asset classes, classic cars are expensive to maintain, so aren’t a good hedge against inflation. Neither is gold, but it’s much cheaper to park.

Stefan Hofer

Chief Investment Strategist LGT Bank, Hong Kong

The key questions that high-net-worth individual investors ask today are, “should I close out my U.S. equity positions” and “is it time to buy China?” On the former, we advise clients to stick with their U.S. positions, or if markedly still underweight, to actually add more. On the latter, we think it is too soon to average-down or stock up on China-related equities, notwithstanding their significant underperformance this year.

On the U.S., the growth story is just too compelling to ignore: according to U.S. Federal Reserve, household wealth in the U.S. has now exceeded $100 trillion – it is very likely that this is the largest pool of wealth in recorded human economic history. The pre-Global Financial Crisis peak in U.S. wealth in 2007 was close to $70 trillion.

With additional fiscal stimulus from the White House in 2019 a distinct possibility, the next U.S. recession could be pushed out beyond 2020, something that equity markets are likely to cheer. For the full year, U.S. firms’ earnings are forecast to grow at 23 percent, which again is well ahead of European peers at 9 percent.

In terms of valuations, with a 12 month forward price to earnings ratio of 17 times, some investors maintain that the U.S. is simply expensive. It is undeniable that there are “cheaper” equity markets to be found. We would argue, however, that given uniquely strong U.S. economic momentum, investors can expect to pay more to own these fundamentals, and won’t be wrong to do so.

On China, there is lingering uncertainty as to how far the current slowdown will go, as the economy absorbs the cross-currents of lowering debt, and at the same time, the central government increases spending to buffer the impacts of the ongoing trade dispute with the U.S. We may see some improvements on this front as Presidents Trump and Xi are expected to discuss trade at the G-20 in Argentina.

For China stocks, it is arguably too soon to say where the floor will be for growth, and how effective recent policy moves will be. On the plus side, overall food inflation is near zero, and if the November 11 (Single’s Day) sales numbers are anything to go by, the Chinese consumer remains in good health. As such, important economic fundamentals in China appear robust enough to withstand the trade-related shocks that are in the pipeline. That does not mean it is time to buy, however, and we think investors should be patient, as better entry levels are likely to be ahead.

The other way to play: On a purely personal level, my out-of-the-box investment idea is to buy contemporary Korean art, mostly because I purchased a painting by Sungsoo Kim four years ago and am waiting for it to appreciate. It’s hanging in my home and I enjoy it every day.

Edie Hu

Art Advisory Specialist at Citi Private Bank Hong Kong

Before you think about investing $1 million in a painting, make sure you really like what you’re buying. Given the fickle nature of the art market, you could get stuck with it for several years, so get something you’d like to see on your wall. Do your homework and search auction records to avoid buying works that get flipped every couple of years. And in case you missed the memo, the Chinese contemporary art market peaked several years ago.

Now collectors are chasing works by 20th century Asian artists whose western peers have long been recognized. Japan’s Gutai abstract expressionist and avant garde painters like Kazuo Shiraga and Atsuko Tanaka have appreciated steadily in recent years, while western-influenced Korean minimalist painters like Lee Ufan, Park Seo Bo and Chung Sung Hwa are also on the rise.

If black and white is your thing, contemporary ink paintings are undervalued—and they fit nicely with modern décor. And because they draw on the centuries-old “literati” tradition of Imperial Chinese scholars, you can earn extra bragging rights for cultural sophistication. Top works by Shanghai-born Li Huayi, now 70 years old, can be yours for about $600,000 or $700,000, and Liu Dan’s meticulous paintings can still be found for less than $1 million. Collaborative works by New Jersey-based classical landscape painter Arnold Chang and Michael Cherney, an American photographer in Beijing, are among my favorites.

Australian art has been largely overlooked outside the country, and that’s a pity. Next time you’re Down Under, check out the works of Brett Whiteley, who died of a drug overdose in 1992. His vibrant canvases owe a lot to Matisse and other Fauvist painters of the early 20th century. His most expensive work sold for $2.9 million, but there are still plenty of his smaller oils for well under $1 million. His stuff is absolutely beautiful.

The other way to play: For an out-of-the-box idea, think vintage toys. As people get older they get nostalgic for childhood playthings. A Barbie doll sold for $302,500 in 2010, and Gen-Xers have pushed up prices for Star Wars figures, with two Jedi Knights from 1978 going for a combined 100,000 pounds in April. And board games like Monopoly are perennial favorites.

Hao Hong

Head of Research and Chief Strategist at Bocom International Holdings Co.

For the Chinese, time is cyclical, a tapestry of monsoons, seasons and the rise and fall of dynasties. The I-Ching, for instance, is a book of divination based on cycles. And so it is with economies too.

Our research has shown that there exist well-defined short cycles of around three to four years in the U.S. and China’s economies. Every few years when the short cycles in the US and China entwine, significant gyrations will occur in markets and the social domain. We are now about to enter such a phase. The confluence of the declining U.S. and China economic cycles soon will prove to be too tough to overcome.

The significant fall in China’s stock market, which hit a two-year low in September, is a prelude of what is to come. At such volatile times when the bear market beckons, one should refrain from the urge to catch falling knives, even though markets here have cheapened substantially. China will continue to get cheaper but there is no reason for a rebound.

U.S. equities cannot escape this cyclical fate either, and are in for tough times too. As China decelerates, the rest of the world will feel the chill. This is no time to be buying, but neither should you sell. Protect your positions by buying put options, and as long as volatility is low you have got yourself a cheap insurance policy against the downdraft. There will be better entry points after the storm.

Meanwhile, U.S. Treasury bonds and the U.S. dollar could provide a safe refuge. Gold can help you hedge to your position in U.S. holdings, so if the dollar weakens, gold will strengthen. If you combine the two, you won’t lose money. We don’t recommend high yield corporate bonds, because in times of crisis, they behave just like stocks.

The other way to play: For a really out-of-the-box investment, I would put my money into Kweichow Moutai, the fiery Chinese liquor, the only investment to outperform China’s housing market in the last two decades. Like some of the finest French Bordeaux wines, supply is strictly limited and it appreciates in value with age. A single bottle of 1940 vintage sold for 1.97 million yuan ($287,700) at a July auction in China.

Goodwin Gaw

Chairman of Gaw Capital Partners

Ho Chi Minh City real estate. It’s a no brainer. It’s where southern China was 15 years ago. There is already a lot of migration from southern China opening factories in the country as the mainland ones are shutting down. These export-oriented factories earn hard currency so there are more small and medium-sized enterprises earning dollars. The trade war between the U.S. and China will only accelerate this migration.

The owners of these SMEs want to put their money in high-end residential properties. There is also additional capital inflow from overseas Vietnamese sending money back home.

High-end apartments sell for just $300 per square foot, which is a fraction of Hong Kong, where prices are 10 to 15 times as much.

Foreigners can only buy leasehold, and there is a 30 percent quota on how much of any one project they can own. But you can always sell your property to a local who will convert it to freehold.

The other way to play: For an alternative investment, vintage furniture can be interesting for those with a trained eye. The younger generation is looking for authenticity and the patina that only comes with time. I am a fan of Danish modern design from the 1940s to 1960s. Last year a pair of armchairs by Finn Juhl sold for $120,000 at a Phillips auction here in Hong Kong. One cost just $295 when the model was launched in 1954.

William Ma

Chief Investment Officer Noah Holdings Ltd

With all the clouds on the horizon, trade wars, higher interest rates, inflation, we advise focusing on markets less correlated to global uncertainty. India, which is set to become the world’s third-largest economy by 2030, is a good place to start. Exports as a percentage of GDP are at the lowest since 2003-2004, but the domestic consumption is the engine of growth, and it’s less sensitive to U.S.-China frictions. The Bollywood, not Hollywood theme applies to many domestic brands from whiskies to motorcycles to local e-commerce giant Flipkart.

Creeping protectionism will be good for these companies. We prefer locally managed hedge funds over ETFs and mutual funds, which have a high weighting in bloated state-owned companies. Though rupee weakness is certainly a risk, most Indian fund managers have hedged their currency exposure by about 50 percent.

We’ve been overweight Vietnam for three years, with about 10 to 15 percent allocation compared with an MSCI weighting of 1 to 2 percent. The country could benefit from a prolonged U.S. trade war with China as manufacturing companies relocate there. It’s like China 15 years ago. Unlike India, we are fine with ETFs because many of Vietnam’s largest cap companies are well-run.

The domestic consumption theme still applies to China too. Watch Foshan Haitian Flavouring & Food Co., the country’s largest soy sauce maker. People are eating better and taking better care of themselves. We see new trends in dental care with many small local companies raising private funds. Per-capita spending on dental care in China is $9 compared with $391 in the U.S.

Now is not the time to be investing in fixed income. There are a lot of people buying treasuries and high yields and spreads are very tight. But equity yields of 3.2 percent in Asia ex-Japan look attractive compared to the 1.9 percent in the U.S. Returns are even better for Chinese companies in the Hang Seng China Equity Index, yielding 4.5 percent.

The other way to play: Meanwhile, you might consider investing in a rare Chinese tea called Da Hong Pao, “Grand Scarlet Robe.” It’s grown in the mountains of northern Fujian province and production is highly regulated. Tea leaves from the handful of original, 300-year-old bushes have sold for the equivalent of more than $1 million per kilo. It is considered the ultimate gift in China.

Figures for the five-year performance of select assets are based on Nov. 23 closing prices.