Chinese stamp investment outlook - Paul Fraser's view

What do you think the value is in investing in stamps where China has had such a big effect? Ken, via email, May 30, 2012

Paul: Ken, a great question. The new wealth of China has had a huge impact on the stamps and collectibles sector, especially within China itself. The country's rapidly expanding number of millionaires means values for Chinese stamps are soaring - in the past few days we've seen the Chinese stamp auction record broken, and Monkey stamps are up 186% in 18 months. While this influx of money into the China stamps market means many buyers have now been priced out, those at the top end can capitalise on the rising prices by buying now.

Will the price rises continue beyond the short term? The jury is out on the long range future of the Chinese economy (and the subsequent spending power of Chinese buyers) but the IMF predicts that it will continue to grow at a steady rate of 8% pa until at least 2015 - plenty of time to get in, and out, if needed.

China's impact on the rest of the stamp sector has been less pronounced, with Chinese buyers tending to focus on issues from their own country. Consequently, areas such as Great British stamps continue to show strong, steady gains, without the huge spikes seen in the Chinese market. The 30 leading collectible British stamps have risen in value by 10.8% pa since 1998.

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