BT MAGAZINE 2024 VF no marks 8 oct - Flipbook - Page 22
ISSUE 17
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ART AS ASSETS
Art investment shares similarities with other asset
classes, yet offers unique characteristics. Although
personal taste is a factor, the objective is to acquire art
likely to appreciate in value. Important factors include
the artist's reputation, the rarity and uniqueness of the
piece, its historical significance, and current market
trends.
HIGH RETURNS ON INFAMOUS ART SALES
Several notable art sales illustrate the lucrative potential
of investing in iconic art pieces. For example, in 2018,
the top 10 most expensive paintings sold at auction
demonstrated an average annual return of 19% over the
previous decade.
unique role in the buying and selling of art, contributing
to the overall dynamics of the market.
Auction Houses
Auction houses like Christie’s and Sotheby’s are the
most visible and prestigious venues for art transactions.
They facilitate the sale of high-value artworks through
public auctions, where pieces are sold to the highest
bidder. Auctions’ transparency and competitive nature
help establish market benchmarks for specific artists
and works, helping investors gain insights into what’s
likely to appreciate. Auction houses also offer services
like provenance verification, cataloguing, and expert
appraisal, which are crucial for maintaining the
integrity and value of the art market.
Appreciating art work (in both senses of the word) is a
financially viable strategy that can fetch exponentially
higher prices over time.
"Don't just chase big
names. Analyse auction
trends to find consistently
performing
artists.
Remember, art is not just
about returns—consider
tax benefits and estate
planning to maximise
value."
Before you get carried away and rush off to buy the
latest Banksy, a word of caution: Art investments can
be advantageous but require significant knowledge and
expertise. Potential investors should consider engaging
with professional advisors and leveraging platforms like
auction houses and online marketplaces to navigate the
complexities of the market. Institutions that provide
services including provenance verification and market
insights are a great help in making wise investment
decisions where artwork is concerned.
Incorporating art into a diversified investment portfolio
involves understanding its financial and intrinsic
value. This strategic integration enhances portfolio
diversification and offers a tangible connection to
cultural heritage, making art investments a unique
blend of passion and pragmatism.
By viewing art through the dual lenses of cultural
appreciation and financial strategy, investors can
unlock the full potential of this captivating asset class,
balancing aesthetic pleasure with economic gain.
ART MARKET DYNAMICS
The art market operates through various channels,
including auction houses, private sales, and,
increasingly, online platforms. Each channel plays a
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