For centuries, the wealthy and the influential have invested in art as an indicator of their power and affluence. In recent times, art has assumed importance as a long term investment in the face of a fluctuating financial market. Many analysts have clearly shown that art is emerging as a smart investment.
Many banks and investment consultants are now offering art as an investment option. ABN AMRO offers art investment advisory services, establishing a unit that will provide the private banking sector with what it calls “a broad range of art investment services that can be offered to end clients”. The private banking arm of ING Vysya Bank is aggressively targeting the country’s high net worth individuals (HNIs). “It is opening more dedicated offices and offering newer forms of investment, including art”, reports Times News Network, in July 2005. The British Rail Pension Fund invested part of its portfolio in artworks as early as 1974.
Collecting contemporary art is a wonderful way to begin a collection or to add new life to an existing portfolio. Over the past few years, contemporary art has set record-breaking sales at auctions. Living artists are now commanding lakhs for their contemporary pieces.
If this is your first foray into art investment, begin by educating yourself about contemporary artists. Take note of emerging artists with longevity, not just the artists who have one big show and quickly fade away. Diversify and strengthen your contemporary collection by purchasing works by well-known contemporaries as well as lesser-known regional artists. Consider your collection to be like a stock portfolio: the ‘blue chip stocks’ (or well-known art) will consistently maintain the high quality of your collection, while your ‘small companies’ (or regional emerging artists) will add bulk to your collection and always have the potential to really take off.
The best way to choose what you want to invest in is to see how the particular piece affects you emotionally. This is a kind of investment which depends more on your sensitive side than on your business side! Remember that you will be living with the art piece in your home or office. Collecting art can be one of the most enjoyable ways to spend money. A striking work can provide its owner with a lifetime of visual pleasure- and then fetch cash! But investment in art should not be solely financially motivated. Buy what you love, because even though it might go through a transitory devaluation, the intrinsic value of the work will always be there.
|
)
)
)
)
)
)