Owner: Art Market Blog URL:http://www.artmarketblog.com Join Date: Mon, 23 Apr 2007 19:59:36 -0500 Rating:0 Site Description: Art market blog by art market guru Nicholas Forrest Site statistics:Click here
ART MARKET MOVEMENTS 2007-04-23 00:40:18 ART MARKET MOVEMENTS
One way to decide on what part of the art market to invest in is to look at the various different factors that could evoke a rise in popularity for a particular artist or type of art. There are many factors that can determine a rise in popularity in an artist or type of art many of which may not be immediately obvious. You may need to do a bit of analysis and detective work but you might be surprised with what you come up with.
For instance, I recently did some analysis of the current world art climate and came up with the following results. The current rapid acceleration of the Chinese economy and has meant that there are more people financially able to purchase art which in turn means that there are more artists able to make a career out of their work. This then means that a number of highly talented Chinese artists are being see
Quality is the key 2007-04-20 02:23:59 QUALITY IS THE KEY
Quality
is one of the keys to success in art investment. One of the common mistakes that people make is to assume that cheap means a good investment which is not the case. With art, you are much more likely to make more money percentage wise by paying more for a high quality piece than by buying bargains. For instance, for the price of a poor Picasso doodle you can purchase a high quality photograph by one of the best contemporary photographers. When it comes time to sell your investment the market will be far more receptive to a top quality photograph than to a poor quality doodle.
With the contemporary photography market considered to be seriously undervalued you would be very wise to have some of your art portfolio in photography.
Many of you may be surprised to know that artworks by artists that sell for upwards of severa
Researching the art market 2007-04-19 03:29:18 RESEARCHING ART INVESTMENT
While you have some time off over the Christmas period you might like to spend some time doing some research on art and art investment. There are plenty of sites on the net that can provide you with information on artists such as artnet.com, artinfo.com, artprice.com, findartinfo.com, flashartonline.com, artnotice.com, and many others. You might also want to subscribe to an art magazine such as ARTnews magazine http://www.artnewsonline.com or Flash Art Magazine http://www.flashartonline.com. There may be other magazines more specific to the country you live in so a quick search online for art magazine should provide you with other options.
On a lighter note the website http://www.winunited.com recently allowed people to bet on how much they thought artworks would sell for at auction. Not exactly the safest investment but a fun and interesting idea none the less.
There are also several great books that may give you some further knowledge
Demystify the art market 2007-04-18 04:05:48 DEMYSTIFY THE ART MARKET
The best way to demystify the art market is to visit galleries which allows you to look at the works in the flesh, compare artists and works, and talk to people who can answer your questions and provide you with the knowledge you require. You can also take the chance to find out more about the gallery that you are visiting and make sure that they are a reputable dealer. There are several questions that you can ask to gauge whether or not a dealer is reputable and they are:
1. How long the gallery has been established for and the history of the gallery
2. The relationship that the gallery has with the artist in question
3. What is the condition of the work
4. What is the provenance of the work
If you cannot get answers to these questions then you should find another gallery of dealer.
Not That Risky 2007-04-16 06:11:45 Not That Risky
I recently came across a list of possible risks of investing in art which when analysed don’t really pose that much of a risk at all. The list of possible risks was as follows:
1.Possibility of owning/selling frauds and fakes
2.Illiquid auction/dealer markets.
3.Maintenance, restoration costs.
4.Artworks produce no income unless sold.
5.High transaction fees.
After considering these possible risks I have commented on each below:
1.The possibility of owning/selling frauds and fakes is a possibility if you do not take precautions and do not do your research before purchasing. If you do your due diligence beforehand this will not be an issue.
2.Art investment is recognised as a long term investment therefore you should be aware of this before you invest so that you can allow for the possibility that you can’t instantly liquify the asset.
3.Maintenance and restoration costs shouldn’t be an issue as any artwork that you buy should ta
Art Market Influences 2007-04-16 06:10:57 Art Market
Influences
There are many factors which determine the value of an artists work but the main influence is the career progression of the artist. One of the big differences between classical art and contemporary art is the way in which an artist gains their reputation and furthers their career. The status of a classical artist mostly depended on their artistic ability to reproduce detail and likeness as accurately as possible whereas with contemporary art an artists status can be affected by their ability to break new ground, their ability to respond to peoples obsession with popular culture and the media, the edginess of their work or an ability to excite the senses and stimulate emotions in new and challenging ways, and the list goes on.
There is no doubt that the swift progression of the contemporary art market and its variety of influences has made it more difficult for investors to try and predict the next big thing although it has also meant that there is more
Facts and Figures 2007-04-13 02:28:19 Facts and Figures
Further to the figures and results shown above I would like to specifically highlight two very important points which are the recommendation of 5-10% of your investment portfolio be in art, and that art investment is a long term investment of at least 5-7 years. These two points are crucial because they define art investment in terms of its position within the investment arena and allow people to categorise art investment within their investment portfolio.
The figures certainly do look good for art investment but there are some further points that need to be taken into consideration in the form of possible further costs such as framing, insurance and transactional costs which are not usually mentioned.
I often get asked by people why they should invest in art when they can apparently get better returns else where. My answer to these people is that investment is not just about the highest potential return but about having a portfolio that is diverse a
Facts and Figures 2007-04-12 05:52:24 Facts and Figures
Many people argue that they do not invest in art because there are not enough facts and figures to support it so I have included some below for your information.
Contrary to popular belief, art does not tank in value during times of stock market weakness or war. Fine art’s 256% rise in the last great bear market (1966-1975), during the Vietnam War, is a testament to that. According to an exhaustive study by NYU professors Jianping Mei and Michael Moses - using figures from the 27 recessions dating all the way back to 1875 - fine art investments hold up very well in bad times. It is a good store of value.
Zurich Financial Services published figures in 2002 showing art and antiques to be one of the most lucrative investments: over the previous 25 years, high-grade collections had risen in value by more than 785%.
A new joint study published this summer set about finding out more on investment opportunities in the world of art, especially conte
Emerging Artists 2007-04-11 03:08:27 Emerging Artists
Having mentioned the term emerging artist quite a bit I though it important to explain the concept a bit more. Investing in emerging artists should really only be attempted by seasoned art investors or those able to take a larger risk.
The term “emerging artist” is used widely in the art world to describe an artist who is at the beginning of their career, and comes with certain connotations and expectations in terms of the artist’s level of education, commercial exposure and experience. The problem is that there are no set criteria to define an emerging artist and this has caused a lot of confusion and misrepresentation within the art market.
The appeal of the “emerging artist” is two fold; firstly there is the low entry price for works by emerging artists, secondly there is the exciting opportunity to potentially invest in the next ‘Picasso’.
Whether you are looking at purchasing an artwork purely for
EBAY 2007-03-29 04:40:28 EBAY
The ebay phenomenon as it is commonly called has opened up a whole new market for buyers of art but it has also allowed plenty of fakes and scams on the market as well. Ebay can be good for collectors who are looking for very specific items but it is not really a good place for art investors to purchase unless you are an art expert and even then extreme caution needs to be exercised.
There are no regulations or safeguards on sites such as ebay to prevent you from buying a fake or misrepresented artwork so there are plenty of unscrupulous people who will try to take advantage of you.
One of the traps that many people fall into is the lure of the signature. Some people have the idea that just because something has an artists signature on it that it is worth a lot of money but signatures can easily be faked. Another fallacy is that any art work with a famous artists signature is going to be a great investment. The fact is that a bad work by any artist no matte
Fine Art Funds 2007-03-27 03:18:32 Fine Art Funds
Another form of art investment that has recently become popular is investing in a fine art fund. Basically investing in an art fund works much the same was as investing in shares, instead of buying a whole artwork you can buy shares in an artwork along with other people. Then the painting is hopefully sold for a profit which is then passed back to the investors.
This means that people with smaller bank roles can still take advantage of investing in a major artwork by a blue chip artist which would normally be out of their reach.
Only a few countries currently have access to fine art funds but more and more are being created every year.
Investing in an art fund is for those purely interested in the financial gains and not in the aesthetic pleasures. One of the main reasons that many people invest in art is because they can have the pleasure of having a beautiful piece of artwork on their wall so you should take this into consideration when d Read more:Fine Art
Art Rental 2007-03-27 03:18:04 Art Rental
As I mentioned above there is more than way to invest in art. As art investment becomes more popular and a more widely acknowledged form of investment companies are coming up with different vehicles for investing in art such as investing in art rental.
Investing in art rental involves a gallery or broker selling you a portfolio or piece of art which is then rented out to the corporate sector on your behalf giving you a return which is usually underwritten and usually between 5% and 9% a year for up to 3 years. This means that you can purchase some artworks and get a guaranteed return while you take advantage of the capital appreciation.
Once the rental period is over you should get the option of either taking collection of the artworks, selling the artworks or going back into the rental program.
The gallery of broker that sells you the work will rent your artwork out to businesses and organisations for them to put in their offices and boardrooms et
Sources of information 2007-03-20 23:57:24 Sources of information
One of the biggest hurdles that art investors face is knowing which artist to invest in. Since I don’t have a crystal ball I cant tell you is going to make you the most money but what I can do it give you the tools to be able to analyse an artist to gauge their investment potential.
People tend to think that the art market is so totally different from other investment markets that it is almost impossible to find the information required.
If you were going to invest in the share market then you would either do your own research in magazines or on the internet or take the advice of a stock broker in order to decide which stock is best to invest in. The art market works the same way with plenty of information available on the internet and in magazines as well as through art brokers. Do a search on the internet for art investment or the art market and you will come up with a large variety of sources that should satisfy any query. There are also m
Limited Edition Prints 2007-03-20 23:56:50 Limited Edition
Prints
I have included an article I wrote below for a magazine that give some further information on the limited edition market. Some of the information may be repeated above but it is important knowledge to have if considering the art market.
The recent interest in art as an investment has exposed a lack of knowledge of, and appreciation for, original limited edition prints, which have proven to be a very good investment providing that you the do the appropriate research and follow certain criteria.
Some of Australia’s greatest artists including John Olsen, Tim Storrier, David Boyd and Charles Blackman have all released original limited edition prints that have been very popular and highly collectable works of art.
These genuine fine art editions provide collectors and investors with the benefits of purchasing artworks by leading artists but at a lower entry point than their original works. Unfortunately, the wide variety of printing methods and the
CONTEMPORARY PHOTOGRAPHY 2007-04-26 01:51:22 CONTEMPORARY PHOTOGRAPHY
Having mentioned the contemporary photography market recently and referring to it as an undervalued market I thought it important to explain why the market is considered to be undervalued.
Photography has in the past been considered more of a form of historical recording rather than an art-form but more and more artists have been using the photographic medium to produce fine art.
Another factor that has dampened the market has been the debate as to exactly what constitutes fine art photography and what doesn’t, but as the market matures the boundaries are becoming clearer. It has taken rather a long time for the historical recording stigma to be lifted from fine art photography and for it to begin to be accepted as a legitimate form of fine art.
With the digital age and the continuous challenging of the boundaries
Art Market Growth 2007-04-30 00:48:05 ART MARKET GROWTH
Over the last few years the art market has grown extensively to become a recognised form of alternative asset all over the world. The art market has grown from a relatively narrow and restricted market to an expansive global market which depending on the figures you look at has been shown to be up to 20 times larger than it was in 1990.
This globalisation of the art market has provided investors with a certain re-assurance and sense of security that relates to the old theory of there being safety in numbers. As well as an increase in the number of art investors the increase in the number of countries and economies that are involved in the art market can also been seen to give strength to the art market as a whole.
With the digital age providing so much information, the art market has become more and more transparent giving peopl Read more:Market
, Growth
SURVEY STATISTICS 2007-05-03 00:44:02 SURVEY STATISTICS
A recent survey conducted by AXA Art Insurance (http://www.axa-art.co.uk) and Investors Chronicle, 87% of people surveyed thought that investment in art and antiques was a good investment for them. The survey also showed that of the people surveyed art investment was ranked as the second most important investment behind a property to live in and in front of government securities and the stock market.
Other results revealed that among the advantages of art investment listed the sample thought that the following were of most importance : home enhancement (35%); a tangible asset (31%); stability and as a pension fund (16%).
This survey shows an increased awareness of the art market and a greater acceptance of art investment as a genuine investment option. With artworks selling for over $100 million US dollars and a bull art market worth ten Read more:SURVEY
BEARS AND BULLS 2007-05-04 04:21:16 BEARS AND BULLS
The terms bull market and bear market are common place in the world of investment and are typically used in reference to the stock market but can also be applied to the art market. For those that don’t know, a bull market is characterised by optimism, investor confidence and expectations that the strong results will continue where as a bear market is characterised by the opposite.
In order to gauge whether a market such as the art market is bull or bear you would need to survey a large sample of people who have a knowledge of, and insight into the art market. This is exactly what art market analyst Art Tactic (http://www.arttactic.com) did in May of 2006 with their Contemporary Art Market Confidence indicator which had risen from 87 points in November 2005 to 97 points in the first half of 2006. A rating of more than fifty signifies
FADS AND TRENDS 2007-05-07 04:05:15 FADS AND TRENDS
Although the art market is a relatively insulated market there does tend to be a vulnerability that is perpetuated by the amalgamation of fine art with popular culture and the influences of commercialism and the media. As I have said many times before when investing in art it is primarily the artist’s career that you are investing in so it is important to be as sure as you can that their career is one that will be long lasting. The problem with artists that take advantage of the hype often associated with popular culture is that the creations of popular culture are often short lived fads.
Artists that fit this category will often see huge increases in price of their works in a short period of time but in the long term the value of their work will often see the same fate as the fad. Investing in this type of artist is very risky as the price spikes are often very quick and unpredictable although the rewards can be much greater but you would need to have the know
PUBLICITY AND PROFILE 2007-05-10 01:04:39 PUBLICITY AND PROFILE
The structure of the art market means that an artists career can be propelled by publicity and exposure even if their talent is disproportionate to the amount of publicity they are getting. Any publicity for an artist whether it be good or bad seems to have a positive effect on their career even if it is only for a short period of time. As an example, an Australian artist by the name of Craig Ruddy won the Archibald price for portraiture in 2004 which is Australia’s most prestigious art prize. Soon after the prize was awarded to Ruddy there were complaints by other artists that entered the prize that Ruddy’s work did not confirm to the guidelines for the type of works allowed to enter. One of the complainants ended up taking Ruddy to court which resulted in a two year court battle which Ruddy eventually won. During this period Rudd
Limited Edition Prints 2007-03-16 00:00:45 Limited Edition
Prints
For those starting out with art investment I would suggest that you seriously consider the limited edition market. Original limited edition prints are created in conjunction with the artist and involve a large percentage of hand crafting in the creation process. The plate is always hand crafted and depending on the type of process used, the colour is often applied by hand also. The application of the colour by hand means that each print is slightly different from the next. These are the differences between a poster print which is mechanically produced and an original limited edition print.
There are many different types of printing processes that can be considered to be original prints and it would take a books worth of info to explain them all in detail so here is a website to give you a brief outline:
http://www.berkeleyeditions.com.au/htmlpages/techniques.php
Original limited edition prints are not copies of an artwork like many prints
Introduction 2007-03-05 23:25:02 Introduction
Welcome to the Art For Profits website which is part of the artnotice.com network which includes the hugely successful artwebshow.com.Â
As an art journalist and art consultant I am aware that there is a general lack of knowledge and information when it comes to investing in art. The art market is enormous and diverse which means that there are many traps that investors can be caught in. It can be very daunting for the novice investor to be faced with so many options and variables but there are some general tips that can make the process much less risky which is why I have started this site.
As this site is in its infancy there will be regular updates and changes to the site so stay tuned and return regularly for information, tips and advice on the very exciting topic of art investment.
Read more:Introduction
ART MARKET RELATED STOCKS CONTINUED.. 2007-05-16 04:54:34 ART MARKET RELATED STOCKS
Further to the previous post on art market related stocks, the company that can be considered to be the proxy for art market stocks is Sotheby’s who have a large percentage of the segments total market capitalization. Because there are so few art market related companies in the stock market those that are listed tend to be grouped into the luxury goods sector. The Sotheby’s share price graph shows that the company has been doing very well although it is important to note that Sotheby’s do not just sell art so their share price is not an accurate representation of the state of the art market. Many financial experts are predicting an increase in the Sotheby’s share price due to the new wealth in Russia and China.
Although you may like to get involved with art market related stocks or included them in your share portfolio I would not recommend using them as a replacement to investing in pieces o
CONTRIBUTING FACTORS 2007-05-18 00:53:24 CONTRIBUTING FACTORS
I have mentioned in recent posts that there are many different factors that can have an affect on the prices of an artists work such as media exposure, exhibitions etc. I have been able to obtain evidence of this from data collected from the art market database artprice.com.
The figures show that during 2002 and 2003 there were a few major artists who had significant anniversaries of their deaths or births which had a very positive effect on their prices. For instance, Camille Pissarro (1831-1903), Vincent Van Gogh (1853-1890) and Paul Gauguin (1848-1903) all experienced an increase in their prices of almost double during their this period.. Although their prices rose during this period it is quite likely that they would smooth out again once the hype is over so timing is critical in these situations.
It is impossible to predict what an ar
ARTIST/ARTWORK EXPOSURE 2007-05-20 19:39:03 ARTIST/ARTWORK EXPOSURE
Further to my last post on the different events that can affect the prices of artists I have accumulated some more data that provides further evidence of how different factors can contribute to the price rise of an artist.
Art is usually bought with the intention of hanging on the wall and providing enjoyment for the owner which means that some artworks stay in the hands of their owners for long periods of time. If an artwork by a well known artist comes onto the market after a long period of time in a private collection there tends to be a lot of interest and exposure given to these works resulting in more competitive bidding and a higher realised price. Artworks from prestigious and well known public and private collections that come onto the market also seem to attract premiums because of the provenance.
Acc
THE ART OF PUBLICITY 2007-05-24 01:39:10 THE ART OF PUBLICITY
Over the years there have been many artists who haven’t received recognition until after they are dead. Take Van Gogh for instance who is now one of the most famous artists of all time yet didn’t find fame until years after his death.
It doesn’t matter how good an artist you are, if you don’t have good sales skills or a good publicity machine behind you then it is unlikely that you will receive the recognition that you deserve.
The publicity, controversy and exposure that the contemporary art market has experienced has changed the position of the visual artist and the requirements of success within the art world. These days there are more influences on an artists than just their ability to paint and promote their work as the status of the artist has gone from artisan to something like that of an actor whos
DESIRABILITY AND CREDIBILITY 2007-05-26 22:44:50 DESIRABILITY AND CREDIBILITY
An exhibition has just opened at the P.S.1 MOMA gallery in New York of works that artists have kept for themselves and not sold for various reasons. The exhibition is meant to be a stand against the influence of the art market on the art world but I think that the fact that an exhibition such as this is required actually highlights how important the art market is to the art world. I also think that because the art market is in so important to the world of fine art that the artworks in the exhibition are likely to receive more interest because of their new-found commercial desirability than their importance to the artist. This exhibition also raises another important issue to keep in mind when looking at purchasing art for investment. Artists who churn out work and have a purely commercial outlook and purpose to their work are likely to damage their reputation as an artist making their work a less desirable investment.
It is well worth looking out for art
ART INVESTMENT FUND PREDICTIONS 2007-06-09 06:16:07 ART INVESTMENT FUND PREDICTIONS
Neville Tuli, the CEO of a new Indian art investment fund called Osian recently made the comment that he would be displeased if the fund did not give a return of 35-40% per annum. Compared to art investment funds in the UK which only look at an annual return of 10-15%, 35-40% which could spark a coup in the investment world if all goes as planned. To make this deal even sweeter, the 35-40% return per annum is predicted to last for up to 10 years. The entry level for most of the Indian art funds is also much lower than the UK art investment funds at around $25,000 US dollars compared to $250,000 for the UK.
I am aware of how hot the Indian art market is right now but even as an advocate of art investment I would question the ability for the Osian art fund to give these sort of returns but even if they could give half what they are claiming they would still be well up on most other investment options.
The Crayon Capital Art Fund, another Indian
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