Wouldn’t it be awesome if you could invest in a Picasso or a classic Rolls-Royce?
The main snag in this dream is that rare and desirable assets tend to be prohibitively expensive!
Plus, keeping such items in good condition over time costs money beyond the initial purchase price.
This includes things like cleaning, storage, and periodic appraisals.
And if you end up with one of these assets, a buyer who is willing to validate your risky venture isn’t a sure thing.
Luckily, the advent of fractional ownership models solves these issues.
When you buy a collectible’s shares, you can spread your investment, reduce your risk, and have someone else take care of the item.
That’s where Rally Rd (or simply Rally) comes in.
It’s a free investment app that lets its users invest in museum-quality collectibles.
So, how does Rally work?
Does it have any fees?
How else does Rally deal with the uncertainty of investing in rare items?
We will address these questions in this post.
A Brief Intro To Rally Rd
Rally Rd is a service that allows investors to own a piece of cultural history.
They purchase collectible items and convert them into tradable securities.
The business raised $10 million in first- and second-round seed capital in its first year.
The fact that Rally Rd assets are kept at its New York City offices is one of the company’s distinctive characteristics.
They periodically swap out the assets that are on display in their showroom.
The experience differs greatly from owning publicly traded corporation shares because you can see your investments.
How Does Rally Invest Your Money?
Asset classes that Rally believes will increase in value are sourced based on the following objective criteria:
- Historical significance
- And more
It doesn’t focus on one style but buys a wide range of collectibles.
This caters to many investors with varying risk tolerances and return expectations.
So, anyone can manage their finances and invest their time with the app.
At least 90 days must pass between an asset’s initial public offering and the start of trading on the secondary market, where investors can make offers to buy shares.
You can cash out or lessen your exposure at any moment by offering your shares for sale through an ask rather than waiting for Rally to sell the asset.
Who Can Use Rally Rd?
Any investor who wishes to diversify their portfolio or invest in collectibles should consider Rally.
However, these investors need a Social Security number, to be at least 18 years old, and to reside in the US.
Through this platform, non-accredited investors can also gain access to alternative assets.
The sole legal limitation on average investors’ investments is a 10% cap on their annual income or net worth.
Accredited investors are not subject to any investment limitations.
Your annual income must exceed $200,000 ($300,000 joint).
Your liquid net worth must exceed $1 million to be considered an accredited investor.
What Assets Does Rally Rd Offer?
There are five collectible asset categories available on Rally, which are:
Memorabilia (including NFTs)
The items in the Rally Memorabilia collection are those typically found in celebrity homes.
Maybe you’ve seen such items in your wealthy friend’s house behind glass cases.
Comics and Literature
Since this category includes scarce artwork, classic American novels, and papers dating back to the country’s formation, calling it “comics and literature” is an understatement.
This collection even contains a genuine copy of the American Declaration of Independence!
Owning (part of) a Lambo Countach Turbo will appeal to car enthusiasts!
Watches and Luxury Items
But it can’t be just any old Rolex; it has to be Joe DiMaggio’s Rolex!
Wine and Whiskey
Lastly, Rally’s most miniature collection offers premium booze at costs that rival vintage cars.
This may be the asset class for you if you are a sommelier or are a member of the Council of Whiskey Masters and are skilled at identifying underpriced vintages.
Are There Fees Associated With Rally?
This is where Rally blows its competition out of the water.
The platform doesn’t charge investors commissions, administration fees, or storage costs.
Rally now only generates profits from investments in valuable rare goods.
Naturally, the business may always present fees in the future.
Both a monthly fee and a pay-as-you-go premium plan are on the table as options.
Still, Rally Rd has promised that a free alternative will always be available to investors.
Of course, the business incurs expenses due to maintaining a physical location for each asset.
If the price of warehousing these collectibles is higher than the asset is worth, payouts to investors may be reduced.
But for now, it seems to be a genuine low-cost standout.
The Pros of Investing in Rally Rd
Rally Rd makes every effort to provide as much information as is practical for each item.
Each item is documented with images, and some may even include videos.
You can view information about the asset, including the production year and appraisal grade.
This goes for a recently signed baseball to a master painting that is more than a century old.
Investors can communicate on the platform using the message board and chat.
So, if you’re on the fence about specific investments, you can always discuss them with like-minded folks.
The risk considerations for collectibles differ considerably from those for the stock market.
Novice investors, in particular, should be aware of this.
You could lose money on these investments, so be sure to do your research and weigh the risks.
Rally Rd connects the app to the majority of banks using Plaid.
Many banking and investing apps employ Plaid, one of the most well-known and commonly used third-party services.
You can link your Rally Rd account to your personal or investment-specific bank account, making trading more convenient.
Investors can buy shares during the trading window’s open hours.
Of course, the investment window closes when an offering funding target is reached.
Each deal requires a minimum commitment of $50.
If the per-share price is lower, you might have to purchase many shares of an offering to make the required minimum investment.
The holding period is 90 days.
It would be best to wait for the trading window to reopen or until Rally Rd decides to sell any shares you want to sell before doing so.
With Rally Rd, investing in collectibles may result in dividend payments.
On Rally Rd’s platform, investing in collectibles may result in dividend payments.
Operating costs for the business include the price of storing the item in their New York facility.
Rally Rd will distribute dividends if the offering generates more significant revenue than these costs.
Dividend potential may not be there in all investments.
Since dividend payouts are unpredictable, a target dividend payout is not disclosed.
Consequently, consider a dividend payout on this asset class as a bonus.
Buying things they think will appreciate in value and then selling them at a profit is the primary way investors will generate income here.
Access To Blue-Chip Collectibles
Typically, you would need to visit auctions and auto exhibitions and keep an eye out on eBay to purchase the types of items that Rally sells.
The platform’s most significant advantage is that it gives you easy access to a wide range of goods without requiring you to search online or at physical locations.
Rally Rd sells “blue-chip collectibles,” more expensive objects than comparable collectibles.
Each asset class’s accurate inventory of collectibles will vary, and some may not even have any items unlocked.
Signing up for notifications is the best way to learn about future opportunities.
Open To Non-Accredited Investors
Accredited investors only can use specific investment platforms.
Many potential backers can’t afford to use these apps because of this.
But anyone interested in these assets can get their feet wet on Rally Rd!
The Cons of Investing in Rally Rd
The Risk of Losing Money
It is possible to lose money when you invest, just like buying property.
But since you buy fractional shares, investing this way is much less risky than buying collectibles outright.
It’s hard to tell how a collectible will do in the future or if its value will go up.
But you can do two things: look up auction prices and determine how much similar items are worth.
This will help you determine whether Rally Rd’s price is reasonable.
One great thing about the app is that you can see how past and present offerings have done as investments over time.
You can also keep track of how your investments are doing with the platform’s portfolio tracking dashboard!
Slight Security Risk
You must give some personal information, like your Social Security number, to join Rally Rd.
This is how most apps and exchanges for investing services operate, and it helps stop fraud.
Additionally, the data is used for taxation.
The site utilizes data encryption technology to safeguard your information from potential identity theft problems and data breaches.
Your private information will not be sold to other third parties.
It is worth mentioning if you’re curious about what information you’ll have to give up.
The Monthly Trading Window is Narrow
You can miss one monthly trade day if you don’t pay close attention.
Setting up alerts will help you avoid missing out on buying shares before they are sold out.
You may not want to invest in collectibles using Rally Rd because the window is limited compared to other investment services.
Assets are Sold Without Your Consent
You may have a stake in the company’s assets, but Rally Rd has the final say on whether or not to sell.
Nobody is getting together to discuss it or cast a vote on it.
Therefore, the business may decide to sell an asset that you had hoped to keep in-house.
It’s Hard To Value Its Assets
The valuation of collectibles is significantly more subjective than that of more liquid assets like gold.
Research all you want, but there is no way to predict its future value with any certainty.
Does Not Have Retirement Account Options
Investment options on the platform are limited at the moment.
Rally Rd does not now provide any alternatives for retirement accounts, which may be a concern for long-term investors.
How Much Can You Expect To Make With Rally Rd?
Since Rally Rd. is in its infancy, there is little history to base conclusions about the platform’s success or failure with investors.
It has a wide range of collectibles, some of which have increased in value while others have depreciated.
That said, each vehicle and piece of memorabilia that has left the platform through a sale has been sold for more than it was initially worth.
Rally will only sell shares if there’s a profit.
But I can’t say that this is indicative of future outcomes. That’s just how investing works.
Earnings potential, as well as the level of risk involved, will vary across different investments.
Although there are no guarantees in the investment industry, a site like Rally could be helpful if you have specialized asset class knowledge.
Rally Rd FAQs
What is Rally Rd?
Rally is an investment platform that allows users to buy and sell rare and unique alternative assets.
The company was established in 2016 and maintains its headquarters in the Big Apple.
Is Rally Rd Safe?
Rally Rd is a legitimate and reliable investing platform regulated by the Financial Industry Regulatory Authority.
Rally Rd is a reliable trading platform when it comes to investing money.
For every security trade, it collaborates with a FINRA and SIPC-approved broker-dealer.
The collectibles are on display at 250 Lafayette Street, New York, NY, if you want to visit them.
You can visit the showroom five days a week.
How Do You Open an Account?
Rally Rd accounts are free to set up.
You must be at least 18 and a US resident to invest.
To comply with Rally’s know-your-customer (KYC) regulations, they ask that you provide personal information such as your name, address, and SSN when creating an account.
Unlike some other investment platforms, Rally does not need you to be a high-net-worth individual before you can invest.
There is a 10% cap on annual income or net worth for non-accredited investors.
You can trade on the go with the Rally app!
Should You Invest In Collectibles?
Non-fungibles (i.e., rare or unique collectibles) present a fantastic set of challenges for investors because of the following:
b) Limited float
c) Inability to reliably predict future values
To some extent, these drawbacks can be mitigated by dividing a non-fungible artwork into thousands of equity shares.
However, there will be fewer people looking to buy a 0.02% investment in a handbag than there are index fund shares.
DO NOT sell your Rally shares without a solid plan in place.
How’s Rally Rd’s Customer Service?
Since it is still young, the company has room to grow its customer service infrastructure.
You can find some basic information on investing and using Rally Rd on the site’s FAQ page.
You can also reach out to email@example.com with any inquiries.
Since there are no stated business hours for customer service, there’s no saying how long you might have to wait for a reply.
How Often Does Rally Rd Sell Assets?
To maximize profits, Rally may decide to liquidate assets during the peak of the market cycle.
When another interested party accepts an offer that the existing owner takes, the service may also sell the asset.
Since most collectibles have a long-term investment horizon to achieve a profit, the investing app tends to hold each item for many years.
You’ll typically have to wait to sell equity shares.
Investing in rare and valuable items becomes simple and inexpensive with the Rally Rd app.
I hope this Rally Rd review helped you get to know it better.
You can begin investing and diversifying your portfolio with a relatively modest outlay of capital by acquiring shares of several alternative assets.
Using Rally, investors can purchase non-equity assets, which could have similar returns to the stock market.
Remember that the ebb and flow of market sentiment means it could be years before an investment yields a significant profit!