The Art of Investing in Art

While investing in art, it is most important to understand whether you are buying for passion or investment
The Art of Investing in Art
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Chairman & Managing Director of JK International and Director of JK Organisation
3 min read
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In earlier times options for investment were limited, but in today’s versatile era there are a plethora of options. While some might invest in cryptocurrency or real estate, others might look at diversifying their portfolios by investing in exotic asset classes. It could be jewels and coins, vineyards, antique cars, etc. One investment class that has recently become not just extremely popular but also lucrative is art.

Investing in art doesn’t just add to your home décor, it makes you more introspective. If done correctly, it can also drastically increase your net worth. According to recent studies, the price of art has gone up more than 1000per cent in the past four decades. Even so, the primary question that strikes the mind of someone who has never bought art is: is it a safe investment option? The answer is simple: just like any other investment, you need to first educate yourself about the intricacies of the industry and know about the pros and cons of any niche.

So, how to go about it? First, you need to understand that ‘art’ does not just refer to paintings but includes a variety of disciplines such as sculpture, drawings, sequential art and photography. There are many more but when you’re thinking about investing in art, you should:

Study the Artist

It is extremely important to perform detailed research about the artist. Age, education, and previous exhibitions and awards should be known. This can’t be done just by browsing the internet; you will have to actually visit galleries and understand what sells in the contemporary market.

Research the Artwork

The primary question is: how to tell whether a painting is a real or a fake? This isn’t usually a problem if the artist is alive, but if it is a Picasso or a Da Vinci, or any deceased artist, you should obtain a certificate of authenticity from an expert and get it appraised.

Investigate the Dealer

Purchasing art involves a great deal of scrutiny, and the market is such that it is extremely difficult to know the reputation of dealers and brokers. It’s much more feasible to find out a gallery’s reputation.

Where to Buy Art

There are many options. Auctions are exciting, but it is extremely important to stay cautious as you’re not just paying out of passion but also thinking of it as an investment. So, you need to be certain of its value, weigh price and condition, and bid accordingly. Also, you need to know that 10% to 30% can be added to your final bid. Galleries are very different – they provide a relaxed environment in which buyers can take their time to understand, introspect and purchase.

But if you are entirely new and sceptical, perhaps you should start with art fairs as they have more variety at lower prices, and usually prove to be great learning grounds for art.

Reselling

It is extremely important to take good care of your art as it matters greatly while fixing its resale value. Keep it away from a fireplace or damp, humid rooms – these are basic. Also, a timely revaluation will enable you to know its current worth before selling it.

While investing in art, it is most important to understand whether you are buying for passion or investment. That demarcation is paramount and will lead to making the art more profitable.

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