Investing in art is not easy and certainly not as passive as you may think. There are many trade-offs to make on your way to getting a job, and that’s just the beginning. Your art collection needs ongoing maintenance and a stable climate to maintain its integrity and resale value.
While micro-managing your entire art collection can be fun and satisfying, I understand that this style of art collection may not be everyone’s cup of tea, which is why I want to talk about art funds.
The advantage of art funds
Access to high-quality artwork (lower risk)
When you invest with art funds, your capital is invested in one high-priced piece of art, or spread across several, giving you a fractional share of ownership in each. In general, these works are the cream of the crop from Blue-Chip artists. While nothing in life is guaranteed, the investment risk of artwork from Blue-Chip artists is much lower than any other group. This is because their popularity with collectors has long been proven.
Professional curator of art funds
Choosing which artists to invest in requires patience and research. While Easel Investing’s guides try to alleviate some of this investor pressure, not everyone has the time to research.
Art funds further educate this pressure on the time-poor art investor. Art funds are managed by professionals who are familiar with the industry. They will have resources (ie private sale prices from auction houses) to ensure they maintain a detailed picture of the art market and the price and popularity trends within.
Access to expensive works of art
If only to brag, wouldn’t it be nice to tell your friends that you own a real multi-million dollar Picasso, Yayoi Kusama, Andy Warhol or Jean-Michel Basquiat.
No investment in climate control necessary
This advantage of art funds is arguably their best selling point, especially for those living in less than ideal conditions (high humidity, for example). The money you save on purchasing air-conditioning equipment such as humidifiers (and the electricity to run them) can then be spent on investing in or purchasing artwork.
A major disadvantage of art investing is that it can take time and effort to sell your investments. With other types of investing, such as stocks, selling your portfolio can be as simple as logging into your stock trading app and clicking the sell button. With art, you can only have an equally smooth experience by investing in art funds. This method of art investing is as hands-free as it gets.
Art funds don’t have to be just for those who want a hands-free art investing experience. On the contrary, even traditional art collectors should consider this investment option for diversification and the many other benefits mentioned in the article. Art funds can certainly be in your portfolio alongside a private collection.
This post Why art funds could be the future of art collecting was original published at “https://www.benzinga.com/22/08/28482966/why-art-funds-may-be-the-future-of-art-collecting”