Revealed: 10 secrets you need to known about investing in art



2015-06-26 12:18:27

Revealed: 10 secrets you need to known about investing in art

With the world's 'grandest' art fair upon us, now could be an ideal time to start your own collection

The art markets' grandest annual occasion, The International Fine Art and Antiques Fair (TEFAF), is arriving in Maastricht, Holland, this weekend (March 18-17).

Hundreds of the world's top dealers will be in attendance, able to buy anything from the rarest fine art by Old Masters to Faberg trinkets from the 16th century. And if all this seems at odds with the global recession, then think again...

According to a report commissioned by TEFAF - entitled The Global Art Market in 2010: Crisis and Recovery - the global markets for art recovered significantly in 2010, despite ongoing global economic woes.

This was apparently driven by strong performance in the United States and huge growth in China (overtaking the United Kingdom) leading to a "52% rise in the market from its 2009 low point."

In other words, 2011 could be the ideal time for you to begin that art collection you've always wanted. That's why, below, we at Paul Fraser Collectibles have compiled our Top 10 tips for building your very own art collection...

  1. Feel the passion in order to feel the profit

This may seem obvious, but firstly ask yourself: am I really interested in art? Too often, novice investors enter the markets without the passion to back themselves up.

In the end, lack of passion and interest in art can lead you to make poor decisions - both in terms of an investment, and in acquiring things you don't even like.

  1. Educate yourself

Art, they say, is an intellectual pursuit. Your collection should be embraced as an educational process.

Develop your art taste buds by looking atlots of art, andhone your appreciation for the aesthetics. Learn about the different artists (how they have progressed over time,for instance)andfeel your passion grow.

Also develop an understanding of the artists. A good way to do this is to start with drawings. Buy posters and postcards and put them on the walls of your home or desk. This will train your eye and help you realise the aspects of art that you love, and those that you find forgettable.

Finally, equip yourself with a knowledge of art history, the history of the markets and with the current art scene. It can also help to become a member of an art dealers' association.

  1. You don't need to spend loads

In terms of money, remember that collecting is an evolutionary process.

Look at some of the greatest collections in the world: they started with initial purchases or just a few thousand dollars, and were thenbuilt upwards. For instance, the noted collector and Hollywood actor Dennis Hopper both his first Andy Warhol ... for just $75.

Good art dealers appreciate this, and will work with you to build your collection up. It is also is vital that you take your time. Above all, don't rush.

  1. Find a trusted advisor

As more people around the world turn to 'alternative asset's like art, an increasing number of professions are making their living from advising people on how best to benefit.

Typically, if you're looking for an advisor then you investment budget should be in the realm of several hundred thousand pounds. So, as with any other professional field, make sure you choose an advisor with strong references as well as a reputation for honesty and success.

Word of mouth is often the best way to find a good advisor. And you can only do this if you...

  1. Attend art shows - and ask questions

Meet people face-to-face. Get to known not only the dealers, but also - if you're planning to invest in contemporary works - the artists themselves. Chat to them about their works, as this can help you figure out where their art, and your investment, is going in the future.

Here's another reason why you should get to know the artist: many collectors will tell you that pricing art has more to do with the artist than their artworks, at least when it comes to setting the initial price point.

For instance, Damien Hirst or Andy Warhol's names impact estimated values more than whatever artwork happens to be selling. Another question is whether the piece is typical of the artist's work, which can often be a matter of taste.

  1. Don't be shy when talking about art

We've mentioned the importance of going to shows and events, and of interacting with dealers and artists. But, when doing this, always remember: there is no "right way to discuss art," so don't be shy when you meet connoisseurs.

Also, don't worry that you "know nothing about art". While it helps to have founding knowledge, feel free and confident to talk about it in your own language.

At the same time, as you learn more about art -its history, continuity and meaning -your "own art voice" will develop, and youwill evolve into a confident collector.A knowledgeable collector is one who takes a non-stop interest in their subject.

  1. Keenly observe the markets...

As with autographs and other portable and tangible collectibles, the great thing about art is that the price histories are laid out for your to analyse and learn from. What's more, they can help you better prepare for future trends.

Also, if you go to art shows and auctions, and may you begin to hear one name mentioned more and more often. Chances are, that artist is trending upwards and could be worth checking out in relevant price indices.

Good indices include Art Market Research's regularly compiled list. Also, most notable art index the Mei and Moses is an essential place to get your information.

  1. Stick to known quantities when buying

We've mentioned the possibilities over investing in either established artists or newcomers. The old rule of "buying low and selling high" also applies in the art world. So, whichever you invest in, stick to your pre-planned budget and quantities when buying.

Remain focused and responsible in your investing, and you'll be less likely to get stung when the unexpected happens. Here's an extreme example...

The artist Mark Kostabi was well on his way to prominence until he made a comment that AIDS benefitted the art world because it killed many gay artists. This led to a market collapse for his artworks. Basically, his values plummeted overnight.

  1. Avoid salespeople...

Especially those who sell art as a commodity. As mentioned, art collecting revolves around passion and belief. So relyingonsaleability as your ultimate goalsimply won't work.

And, while (as we mentioned above) price histories can help you make educated judgements, remember this: a dealer who trusts their own choices won't refer to an artwork's price history as their primary justification.

An artwork's price history can be very useful, but on its own is no guarantee of anything.

  1. Bear in mind the hidden costs

The costs of restoration and framing can be costly, and insurance is vital.

Works on paper should be kept away from sunlight. If the works are going to be on a wall, it needs to be glazed according to museum standards with acid-free matting and ultraviolet light-resistance glass.

If the work is more than10 years old, then you should have an art conservator look at it before it is framed. Also remember that, with art, you are buying objects that have a life of their own. If you maintain and look after your art, you may one day be asked to loan them to an artist or museum.

Over the art's lifetime, you may find yourself dealing with museums and other institutions as a custodian of the historic artwork, rather than simply as an owner.

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