The best investment advice I ever received came from Warren Buffett. "Buy what you love," he said.
For most investors, that means stocks, bonds, or real estate. But for a fast-growing group of investors "buying what they love" means memorabilia.
Now before you write this off as a fad, consider this…
Jimi Hendrix's guitar originally sold at a New York auction for $100,000 and a mere four years later sold for $480,000.
That's a return on investment of 380%. When's the last time you made that kind of money in the stock market?
The truth is memorabilia is one of the great hidden investments.
In fact, on Thursday, something very unique is going on sale – especially if you're a space enthusiast. It's a toothbrush.
But it's not just any toothbrush, it's the one Buzz Aldrin took with him to the moon.
Believe it or not, the starting bid is $16,000 but estimates from the pros say it could go as high as $26,000.
According to Michael Riley, chief cataloger and historian at Heritage Auctions, Dallas, TX, that's because interest in unique items from the space program is at an all-time high.
"Since 2007, interest has peaked for the space memorabilia beyond our greatest expectations," Riley says. "We are seeing prices we could never have imagined. We have added more collectors, there is more demand and it appears there is even more to come."
Given the track record for sales of space collectibles, Riley is certainly on to something.
For instance, did you know that the slide rule Buzz Aldrin took to the moon sold for $80,000? Or that Astronaut Ron Evans' Rolex that orbited and landed on the moon was auctioned off for $137,000?
The truth is you can even buy your own spaceship. A vintage Russian Vostok space capsule sold at Sotheby's in 2011 for $2.9 million.
But you don't need to be rich to participate in this trend. More down-to-earth prices include autographed photos.
In fact, here's one you might already have…
A John Glenn autographed photo sells for $200, while Neil Armstrong's autographed color photo would sell for upwards of $7,000. The reason for the difference?
Neil Armstrong stopped signing autographs in the "90s and passed away in 2011. Meanwhile, John Glenn is still signing away.
And here's something really interesting. It's called a "Cancel At Launch Insurance Policy." Issued to all astronauts, these policies were written to each astronaut but would be canceled at the moment their spacecraft launched.
But that didn't make them worthless – not by a long shot. The families were left with an insurance document that they could then auction to the highest bidder to collect money for the bereaved family of the astronaut. Each astronaut is named on the document and the average auction selling price for one of these is $1,500-$2,000.
The auction for the chance to buy Buzz Aldrin's toothbrush is one of two annual space collectibles sales. It will take place April 18 in Dallas at the Heritage Auction House with over 550 lots to be sold.
Over 300 of the lots are from the estate of late collector Steven Belasco. The items include a "flown" flashlight from the Gemini 12 mission, estimated to sell for $10,000 to $15,000, that was purchased by Belasco in 1999 for $9,200.
In all, Riley says, the coming auction should net an estimated $1.5 million.
Of course, if outer space isn't your thing, you could always collect something a little closer to home. Martin Nolan, executive director and CFO of Julien's Auctions, Beverly Hills, has found a huge niche market ready to invest in items like the jacket Michael Jackson worn in his epic "Thriller" video. It recently sold for $480,000.
Asked what advice he would give to a new investor, Nolan said, "Always buy from a reputable source, get a Certificate of Authenticity (COA), hold your item for at least five years. If you have done your research and buy at the right price the item should appreciate on average 20% per year."
Those are the kinds of returns that even the Oracle of Omaha would find hard to beat.