The Bill Gross Story
Why Bill Gross likes this asset…
“4 times profit. It’s better than the stock market.”
That’s what Bill Gross, PIMCO had to say about rare stamps, talking to the New York Times in 2007 after seeing his collection of early Great Britain rarities selling for $9.1m at auction.
The collection had a presale estimate of $5m and Mr Gross had purchased the stamps for a little less than $2.5m over 7 years before the auction.
This was the event that put rare stamps on the map as an asset class.
Bill Gross approached the idea of building a portfolio of stamps like he was building a portfolio of investments. First he did his due diligence.
He built up a huge collection of auction catalogs and price guides going back to the 1920s. Then he started to analyse stamps just like he analysed other investments…
He figured out which ones were scarce, and then figured out which ones were cheap and expensive, based on their histories that he’d accumulated.
“I don’t think most of the people in the stamp collecting world understood what I was doing,” he told the Wall Street Journal, who said of Bill Gross: “Unlike stamp collectors of yesteryear, who bought and sold largely on instinct, Mr. Gross relies on some of the same sophisticated financial strategies he uses to make billions in the bond market.”
Gross said: “I looked at the history of the stamps and correlated the prices to the growth rate of the U.S. economy to make sure I wasn’t getting my hat handed to me.”
That strategy certainly worked. A return of over 260% in just 7 years confirms it.
Find out how you can benefit from the rare stamp market and perhaps follow in Bill Gross by looking at our investment options.