Alternative Investing Report - November 29, 2024

Happy Black Friday. The future of sports investing, the risks of AI chatbots, apartment supply will grow in 2025, and self-driving is attracting funding. Let’s dive in!

Today’s issue is brought to you by Masterworks, the platform offering shares of art to everyday investors.

📈 YTD MARKETS

*as of 11/28; Sources: S&P, BTC, FTSE, DJRE, LX1000

🏅 SPORTS INVESTING

As the value of sports franchises have grown exponentially in the past couple of decades, the sports industry has become a much more popular and intriguing asset class. Goldman Sachs released a report about the future of sports investing, which touched on how rising values have made it necessary for leagues be open to institutional investment. Media rights are driving the value of sports teams and leagues, with global sports such as soccer and cricket seeing rapid growth in the past few years. Other growth areas include women’s sports, college sports, and youth sports, all of which have significant potential.

➨ TAKEAWAY: Individual investors, both high net-worth and retail, have begun to see more opportunities to invest into sports teams and sport-adjacent businesses. While values have been increasing rapidly, buying into a frothy market has risks, partly due to the lack of liquidity options. Still, the opportunities bring the potential for strong financial benefits as well as non-financial benefits that come with owning a share of a favorite sports team.

Partner

BofA says +80% of young, wealthy investors want this asset—now it can be yours.

A 2024 Bank of America survey revealed something incredible: 83% of HNW respondents 43 and younger say they currently own art, or would like to.

Why? After weathering multiple recessions, newer generations say they want to diversify beyond just stocks and bonds. Luckily, Masterworks’ art investing platform is already catering to 60,000+ investors of every generation, making it easy to diversify with an asset that’s overall outpaced the S&P 500 in price appreciation (1995-2023), even despite a recent dip.

To date, each of Masterworks’ 23 sales has individually returned a profit to investors, and with 3 illustrative sales, Masterworks investors have realized net annualized returns of +17.6%, +17.8%, and +21.5%

Past performance not indicative of future returns. Investing Involves Risk. See Important Disclosures at masterworks.com/cd.

🤖 AI CORNER


AI chatbots have begun to proliferate, most commonly in customer service settings but also as a way for people to have social interactions. While many are unhappy with customer service bots, it’s the “companion apps” that could create bigger problems. More 20 million people use Character.AI, and the bots are only becoming more sophisticated, posing a risk for young people in particular. Ex-Google CEO Eric Schmidt issued a warning around the risk of “AI girlfriends” and a mother filed a lawsuit against Character.AI and Google because her 14 year-old son died by suicide after becoming obsessed with a chatbot. Plenty of dystopian fiction has touched on the idea of humans having relationships with robots, but with the rapid advance of AI, these scenarios are becoming all too real.

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📰 NOTABLE NEWS

(RealPage)


🏡 2025 apartment supply forecast: The U.S. is projected to add more than 500,000 units next year, with New York leading the way by raw total, but Sun Belt markets seeing the highest gains by percentage.

🚀 Autonomous vehicle funding: The AV space has seen its funding levels triple this year to $7.5 billion, led by Waymo and Wayve, with some car manufacturers also spending big on their own self-driving units.

🎨 October auction sales: While not reaching the heights of the main November auctions, October also saw some notable sales, led by David Hockney’s $17.2 million “L’Arbois, Sainte-Maxime” and Lucian Freud’s $15.4 million “Ria, Naked Portrait.”

🪙 Thanksgiving crypto guide: As the crypto market booms, crypto-curious people are turning to family and friends for advice, and this guide provides talking points to help explain the current state of the industry to them.

📩 John Lennon letter: A handwritten letter from the Beatles legend to Eric Clapton asking the guitarist to form a band together is being auctioned next week, and is expected to sell for $150,000.

💵 BlackRock acquires HPS: The alternative asset manager is buying the private credit firm for $12 billion as it continues to expand its footprint in the asset class.

📝 IN CASE YOU MISSED IT

Have a great weekend!

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