Prospects for investments in art
Aesthetic investments in art objects
Most recently, collectors bought works of art that they liked, while trying not to overpay. When prices soared, the motive for buying was the investment of free funds and profit. If the collection is an appreciable part of the cost of a person, it is perceived with some degree of admiration. After all, he receives dividends in the form of pleasure and enters a fairly rare social category.
Investments in art have recognized and are actively mastering the world of art and the world of finance. A new asset class is almost indispensable for a diversified investment portfolio. He is very reliable. But it is difficult to answer unequivocally whether investments in art are a guarantee of good returns for a short period of time.
And first of all because it is a market of risky, venture capital. If we compare it with the market of start-ups, stock or investing in real estate, the liquidity of the art market is much lower.
Transaction costs are high enough. This is the services of art historians and financial consultants, art brokers and lawyers: it is sometimes impossible to do without them. This commission fees of auction houses - the buyer pays from 12.5% to 25%, depending on the sale price. Reduce the cost of purchasing paintings not in open auction, but by conducting a private transaction through the auction house.
In addition, bidding at the auction can present any surprise. Two buyers can significantly raise the cost. If you liked the thing, and the decision to buy is taken at an emotional level, then the overpayment of 20-30% of the estimate - the pre-sale market valuation - is a common occurrence.
But the opportunity to get a good profit in the short term in this market makes people who have free money look at art. Serious investments can bring serious money.
100% return is not such a rarity on this free, in the literal sense of the word, market. But to feel that it can have the greatest investment potential, can only smart and tasteful collectors.
The most attractive niche of investment in art is the category of old masters. Masterpieces have a reliable history of origin and possession - provenance. All of them are taken into account, the emergence of new ones that have passed all the necessary examinations is a world-class sensation. Perhaps they are, perhaps, only in one niche - contemporary or contemporary art - contemporary art.
250 000% per annum They also set price records that are impossible in more than one sphere of human activity.
Painting Andy Warhol "Lemon Marilyn" was purchased in 1962 for $ 250. After 45 years, it was sold for $ 28 million. 250 000% per annum.
Painting Paul Cézanne "Players in Cards" - the most expensive ever sold paintings. For 250 million dollars it was bought by the royal family of Qatar.
In a dozen of the most expensive paintings, four belong to the brush of Pablo Picasso. Their total cost is 460 million dollars.
If we take into account that 1-10% of free money is invested in art, then the financial state of buyers can be estimated at tens of billions of dollars. The annual turnover of this market can serve as an illustration: 380 billion dollars.
Prospects for investments in art
But an aesthetic resource is available to all investors with prosperity. To enter the auctions of international auction houses, including Sotheby's and Christie's allow the institutions of joint investment. The combination of professionals in the form of a fund or an investment partnership will make it possible to become a full participant in the art market and choose a win-win way - to invest in the masterpieces discussed above.
These are the original counterparts of the blue chips of the stock market. The constantly growing number of collectors and investors, the drying out stream of the influx of museum quality paintings continue to push prices up. On the other hand, this process contributes to the emergence of new works in the market from private collections.
The cost range of masterpieces is wide enough. A few years ago at Sotheby's Picasso painting Fruits et Verre was sold for a small for the masterpiece $ 275,000. Cheaper this painting will never be, but the double-price growth in the coming years should not be expected.
Not fully revealed the potential of Russian art. Its segment in the world market is not so great - about 1% - but this is a full percentage of masterpieces of the highest investment level. It is about the Russian avant-garde: the works of Malevich, Chagall, Kandinsky, Larionov, Goncharova and others.
The peak of sales in the art markets falls on years of financial and economic crises. At this time, painting saves money. This is shown by the statistics of auction sales - Artprice Global Index. The last of them - in 2008 - left in this market only professionals, and from both sides.
GOOD NEWS: FINANCIAL CREAMES CAN BE REMOVED FURTHER! The investment cycle of works of art coincided with the crisis periodicity of 7-10 years. But the post-crisis time demonstrates a steady rise in prices. This makes it possible to assume with a high probability that the cycle has been reduced to 5 years.