Investment options in music

My friend has improved at playing the guitar. Particularly during lockdown this year he has spent time learning, recording and sharing songs online. His repertoire has grown. An investment in his own musical skills which will pay off many times over.

His efforts got me thinking about investment in music. The result is a scattering of options in the form of a blog post. Here are a few random thoughts and discoveries from looking at investment options in music.

There’s a company called Hipgnosis which recently listed on the London Stock Exchange. It buys up music catalogues from artists or other owners with the view that the IP will retain its value and pay back the investment over time as the songs continue to sell. You can buy their shares on the LSE today.

In March 2008, Anchorage Capital Partners announced The Guitar Fund, a $100M fund investing in the rare and vintage guitar market, citing an average annual return of over 31%, according the ’42 Guitars’ tracking index. I would find these sorts of guitars impossible to let go of, and very stressful to keep with toddlers running around my house wielding weapons and generally destroying everything in their wake.

Music Memorabilia can also be a source of alternative investment income or growth if you have the time and the inclination. There is a market for almost anything touched by a rock star. Proof of the rock n roll connection is often the hard part. I have some signed pics of Clapton, Beach Boys, BB King and Aerosmith. Hopefully the signatures are all real. How would I ever find out?

How do you invest in music?

Hifi and WW2

Cognitive dissonance is tricky to deal with.

In Germany after the war, Allied forces found a new recording technology – magnetic tape. This provided a huge leap in audio fidelity ahead of disc recordings and rapidly became the dominant mastering medium for sound. The Nazi’s had used it for a while already for broadcasting. It later enabled multi-track recording and led to the first hifi systems being created.

Fast forward 74 years and here we are, the audio equivalent of the autobahn. A Nazi legacy item that audiophiles and musicians couldn’t really do without. Magnetic tape enables those timbres, tones and spacious melodies.

Of course it would have been infinitely better without the war, and with Nazis never having existed.

But here we are.