4 Legal Investments That You May Not Know About


Content provided by legal writers

Many investors shy away from traditional asset classes like stocks, bonds, and index funds. Instead, they prefer alternate investments that have the potential to outrun equities and other routine parking places for consumer investment capital. Unfortunately, dozens of illegal or borderline legal schemes can get otherwise honest people into trouble with taxation authorities or other law enforcement agencies.  

In the quest to identify high-return opportunities among hundreds of choices, some worry about the legality of unusual selections like jewelry, fine wine, rare coins, foreign stocks, oddball precious metals, livestock, and other off-the-beaten-path concepts. Investors may also worry about how to balance saving vs investing when on a specific budget. What’s hot in the universe of fully legal, alternative, investment-grade assets for 2022 and 2023? The following attract the most attention from those who gravitate toward this niche. 

Gold Jewelry and Watches 

Gold jewelry has been called a hidden asset because the worth of a high-priced item resides primarily in decorative metal. For over a century, families have parked at least a portion of their investable wealth in heirlooms like gold watches, necklaces, rings, and bracelets. While ownership of gold jewelry and collectible watches is entirely legal, people who acquire them should maintain detailed, notarized documentation that includes purchase price, location of sale, and the date received.  

Resale values vary based on the beauty and rarity of the pieces. Still, with gold prices near all-time highs, the idea of acquiring gold jewelry for reasons other than ornamentation is growing at a rapid pace. With or without gold content, Watches are a similar type of alternative asset. Entry prices for acquiring one investment-grade watch can be as high as $10,000; year-on-year returns can also be outsized when the demand for exclusive timepieces increases. 

Real Estate-Based IRAs 

It is not legal to place real estate or precious metals into traditional IRAs. Still, there’s no problem doing so if the account is set up as an SDIRA or self-directed individual retirement account/arrangement. In addition to bullion and real estate, investors can add fractional real estate shares to SDIRAs. However, consumers need to evaluate real estate opportunities based on objective facts. That’s one reason so many prospective buyers use real estate pro forma documents to assess the relative worth of a potential addition to their portfolio. The document lays out all the data in black and white, including operational expenses, disposal costs, acquisition price, and other estimates.  

A good pro forma combines educated estimates with known values to rate the potential of a given property. There’s no faster way of making an informed decision about whether to go ahead with a particular purchase or look for a better one. Because the real estate world is so complex and includes nearly indecipherable jargon and unique terminology, it’s imperative to review a guide that explains how to use a pro forma to evaluate a potential investment. 

Foreign Stocks and Bonds 

U.S. citizens can purchase foreign securities with few restrictions. There are some special requirements for tax purposes for people who acquire huge amounts of non-U.S.-based stocks and other assets. But, for the everyday working person, it’s just as easy and legal to buy shares of IBM as it is to purchase equity in a German-based or China-based company, as long as the securities are listed on a significant, regulated exchange. Many top online brokers offer fund-based choices for account holders who prefer to put some or all of their capital resources into foreign securities. Current favorites include emerging market funds, global indices, and commodities sold on foreign exchanges. 


Rhodium is a precious metal that many people have never heard of. It is the rarest platinum group and is currently the priciest of all precious metals. At over $12,000 per ounce, it is also the most volatile in terms of price, having reached the $27,000 mark in June of 2021. Nearly all rhodium mined is used to produce catalytic converters in modern automobiles. Due to its extreme rarity and high price point, many people assume that there are legal restrictions on the ownership of the metal. There are not. Buying and owning rhodium is like purchasing gold or silver, except buyers should be ready to fork over a vast sum of money and expect prices to fluctuate wildly. 

This content is provided by an independent source for informational purposes only and does not contain legal advice. Consult an attorney or financial advisor when making decisions. This information is provided by legal writers and does not reflect the views or opinions of The Daily Sundial editorial staff.