Art investment is a risky business. Even "insiders" such as
auction houses, collectors and seasoned art dealers make mistakes and sometimes
lose money on what they consider investment grade art. On the other hand, the
returns can be very high, which makes investment in art a potentially high
return but risky bet.
The center of the market for art investment tends to rally around financial centers like New York and London and a lot of interest tends to focus on art that responds to the principle of "Goldilocks "being in the middle: not too old is considered an antique, which often poses problems of inheritance, ownership and lying and not so contemporary that has not appeared in a major auction house.
In between, there are a number of factors that can help reduce the risk. Search auction record of the track and provenance of goods including such things as exposure history and proof of ownership by an expert and selling goods (and thus liquidity), all contribute to reducing the risk.
The center of the market for art investment tends to rally around financial centers like New York and London and a lot of interest tends to focus on art that responds to the principle of "Goldilocks "being in the middle: not too old is considered an antique, which often poses problems of inheritance, ownership and lying and not so contemporary that has not appeared in a major auction house.
In between, there are a number of factors that can help reduce the risk. Search auction record of the track and provenance of goods including such things as exposure history and proof of ownership by an expert and selling goods (and thus liquidity), all contribute to reducing the risk.
As for medium-term investments in art, there is no
risk, but there are measures that can be taken to help reduce those risks.
Various art galleries have different approaches, and while none is unique,
there are methods you can learn and use as part of its own due diligence
process.
Examples of criteria that may be restrictions on
substantive artists applied (for example, having to have formal training or
studied in a certain "school" of art), have had a number or type
exposure (eg, solo shows and international exhibitions), the story of the sale
of art, in a way, breakthroughs in the secondary market. Other criteria may
include in-house art consultants use to review the work to ensure that
sufficient technical merit and checking the supply level of the artist. If you
ask about the list of Customer galleries and whether it included high-profile
private collectors, this will help you get an idea of the
"reality" behind prices that continued large-scale collectors tend to
reflect the value market functioning. If you buy at auction, through a gallery
or on the secondary market asking quetions on the above criteria will help you
determine whether your investment in art is more or less likely to make money.
As with any investment, there is no guarantee of
appreciation - whether stocks, products, wine or art. However, a number of
studies have shown that art investment compares very favorably to other means
to investment assets and long-term period of time (eg, 10 years or more) and
that Art can provide diversification option in a mixed portfolio. There are a
number of tips for investing in contemporary art available on the web. Here are
my 7 tips to add to the mix:
Know any investment is risky art. Think about it,
because contemporary art is even more risky level -which risk you can handle
and what you can do to minimize the risk.
Read art magazines, visit exhibitions, meet artists
(especially if you go to buy your work). Having an idea of what is
included in the biographies, looking for any online art gallery reputable.
Be prepared to hold art for the long term. Ideally, you should press on contemporary art for at least five years.
Check supply levels. Most of the art is available, the application must be for the secondary market to be likely to work in your favor if you want to sell your art.
This fun factor in the "return" on their investment. Sure, you want your art to the increase in value - but if you like and add value to your life, it helps to offset the risk of holding it.
Finally, although familiar names can make you feel that you have a sense of security of investment, if you look back at the history of art is often not the case: the artists and styles come and out of fashion. Purchase you like works by new artists and see them grow financial offer and the head is a rewarding experience.
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