Buying Original Art or Ltd Edition Prints?


                                                                                                                                         SKATE'S ART INVESTMENT HANDBOOK: ANNOUNCING THE UPDATED, EXPANDED EDITION

McGraw-Hill publishes Skate's Art Investment Handbook

 

Skate's Art Investment Handbook: The Comprehensive Guide to Investing in the Global Art and Art Services Market, by Sergey Skaterschikov, is released by McGraw-Hill in November 2009. (Hardcover, 304 pp., IBSN-13: 978-0-07-162572-2, $65)


"Skaterschikov has produced a comprehensive and well written overview of investment in high-end art. Every aspiring investor should read this book cover to cover - twice - before even thinking about writing their first check." -- Don Thompson, Author, The $12 Million Stuffed Shark: The Curious Economics of Contemporary Art

"Whoever thought that Sergey Skaterschikov's initiative is only about long term value creation in the field of arts fall short! It is much more: it’s a commitment for building democratic virtues, because every piece of new art is a piece of new freedom." -- Boris Marte, Member of the Board of ERSTE Foundation

"Skate's Art Investment Handbook is a must-read for anyone who is passively or actively involved in the art world. It is a thorough, accurate and fascinating account of this market that will certainly enlighten the art market amateur, veteran, collector and investor alike." -- Philip Hoffman, CEO, The Fine Art Fund Group


Skate's Art Investment Handbook is an essential resource for investors interested in alternative investment assets. It is also a "must-have" for collectors and art-world professionals. Skaterschikov predicts this period of economic decline will create major opportunities benefiting artists, collectors and investors.

 

Among his forecasts:

In Skate's Art Investment Handbook, Skaterschikov provides a detailed, dispassionate look at the global art investment market. He then outlines an analytical model and rational strategies to profit from that alternative asset class, including techniques that allow investors to:

Skate's Art Investment Handbook provides an extensive data section including Skate's Masterpiece Peer Group: the Top 1,000 Works of Art by Market Value, the Top 50 Artists by Market Value and Skates Index of Repeat Sales. It also includes a glossary of art investment terms.

Sergey Skaterschikov is a Russian national based in Moscow and a financier with over 15 years of experience in the investment markets and on boards of public and private companies. He is the founder of IndexAtlas Group, a private investment company with offices in New York, Moscow and London, primarily focused on the media and entertainment, as well as data and technology sectors. Skate's Art Market Research is one of IndexAtlas Group portfolio companies.

   

 

SKATE'S ART STOCKS INDEX

To compare the performance of the Art Stocks and the stock market benchmark (the S&P 500 is used for this purpose), Skate’s has established the Skate's Art Stocks Index, which is the market capitalization weighted USD index of all Art Stocks followed by Skate's. The comparative performance of Sotheby's share price, Skate's Art Stock Index and the S&P 500 benchmark is shown below.

5-year performance chart – Skate's Art Stocks Index vs S&P 500 vs Sotheby's share price

Skate's Art Stocks Index volume, USD mln

Covering the 5-year period, this chart confirms that Sotheby's shares can be safely used as a proxy for the Art Stocks market. As we can see, up until the 2008-09 financial crisis, the Art Stocks were significantly outperforming the S&P 500. The significant volatility of the Art Stocks market is fairly representative of art prices' volatility in general, as well as the art market's poor level of transparency.

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Arts funding cuts reveal the government's poor business sense

The arts are affordable and profitable, costing as little to fund as half a pint of milk a week per person. The government would be idiotic to cut them

MilkMilked ... The culture secretary's proposed cuts could buy us each half a pint of the white stuff a week. Cheers, Jeremy. Photograph: Christopher Thomond

Whenever there's an economic squeeze, the arts are first to go. Ministers such as Nick Clegg and Jeremy Hunt may endorse the defenceof the social, cultural, even moral value of the arts, but they cut them anyway. So inevitable do reductions seem, playwright Mark Ravenhill haseven suggested the best place to start cutting.

 

If they're so inevitable, why bother writing those defences? Because this time it's different. This is the first time artists have had access to sound, well-evidenced arguments for the economic value of the arts. It's no longer in question: the arts are affordable and the arts are profitable. If the government is interested in saving money, it would be idiotic to cut them.

First, the annual cost of British arts subsidisation is £0.47bn – roughly 0.07% of public spending. That's 7p in every £100, which equates to 17p per person per week or less than half the cost of a pint of milk. Cutting the arts budget would therefore save next to nothing, especially as the cost of the arts vanishes when placed alongside other government spending. According to Mervyn King, the Bank of England governor, the size of the bank bailout is "breathtaking" at close to £1tn. Not many of us even realise how big a trillion is. A million seconds takes 11.5 days; a trillion takes 31,709 years.

All right – it's not as bad as it sounds. Like the arts budget, some 60 million of us share the cost of the bank bailout. Divided evenly, then, we each shoulder a one-off payment of a mere £16,666.66. Bargain. At a rate of half-a-pint a week, that would buy enough milk to last you until the year 4780. If you think about the figure in terms of distance rather than money, the gap between our weekly share of arts subsidy and our share of the bank bailout is the difference between the height of a small book and the height of three Everests. In duration, it's the difference between the time it takes to read this paragraph and the time it takes to win the Tour de France. Including sleep.

Another fun factoid. Jeremy Hunt, the culture secretary, thinks the arts should be looking to philanthropy to fund the impending shortfall. Perhaps he's volunteering. As the fourth-richest of 22 cabinet millionaires (it was 23 before David Laws resigned), he can certainly afford to. The combined personal wealth of the cabinet would easily cover the Arts Council's £58m grants budget, used to fund work by new and emerging artists. Vive la redistribution! (Artists are having fun minting comparisons like these. To find more, follow the #artsfundinghashtag on Twitter. Or, of course, discover your own.)

guardian.co.uk home

 

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9 May, 2010

 

 

                                                                                                                                                       Has the art market recovered from the recent financial crisis? 

 

 

Dinesh Vazirani, CEO and co-founder of Saffronart, is charting new grounds.  Is credited with introducing online art trade in India with an auction house that specialises in modern and contemporary Indian art. This Harvard management graduate shares his views with Garima Pant on the performance and revival of the Indian art market and on his views on the changing profile of an art collector. 

The Indian art market has recovered remarkably. I believe that it is probably one notch ahead of where it was before the financial meltdown shook the global markets. The Indian art market should be able to reach its peak within this year itself. And it’s the old timers who are proving their mettle. Buyers and collectors are going in for modernists like SH Raza, for whom the market has come up. There has been incremental growth for contemporary artists as well. 

What is your perspective for the Indian art market in 2010? 

The markets have matured and so have the buyers. The Indian art market has risen very sharply with a number of collectors coming in. They are looking for the best quality and have become wiser. And, with a wide range of information and knowledge available, buyers and collectors have become more informed. Indian economy is doing well and India has managed to survive the global crisis pretty well. There were people wanting to come in to buy before 2008, but the price rose too sharply then. So they want to come in now and see if they can get premium values on their choice of artworks. 

Which genre do you think will become popular this year? 

The focus and interest of the buyers and collectors is bent towards the masters. The older generation of artists has got critical acclaim, making them more popular among art lovers. The contemporary artists, with their global appeal, focus more on the global market. 

How much has the profile of an art collector changed? 

An avid art collector today has a much younger profile. With better access to knowledge about different artworks, a collector today is better informed. It was the corporate houses and the extremely rich that wereinto buying art a couple of years back. Now we also have the younger, more educated population interested in buying art, which is aware of the worth of what they are buying. It’s a much wider base of people that are into collecting art, which constitutes a lot of professionals, younger collectors from the finance field and young entrepreneurs. 

What needs to be done to draw in the buyers? 

We need to focus on infrastructure such as museums dedicated for art, something that is lacking in our country. It is my dream to have a museum on art in Mumbai and maybe I will be able to fulfill this wish sometime in the future. 


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Fine Art as Investment

The Canadian investment art market is stronger than ever, driven by a strong sense of Canadian identity. It is a Canada-wide market with major strength in the western provinces. In addition, many Canadians living in the U.S. are buying art works by established Canadian artists. While maintaining their strong Canadian identity, they find it to be a better value than American art, which is at times over-commercialized.

Valuations  

To give an idea of the size of this market, approximately $350- 400,000,000 is spent on Canadian art annually, and prices have now reached international levels. Works by many prominent Canadian artists of the last century, such as J.W. Morrice, other Canadian impressionists, the Group of Seven, and Canadian abstract expressionists, to name a few, have risen by 2000% in value over the past 30 years. For example, an A.Y. Jackson in a 2004 exhibition at Mayberry Fine Art, recently sold to a U.S. buyer for $420,000, up $400,000 in 30 years. Another painting at the same exhibition, by well-known Manitoba artist, William Kurelek, priced at $98,000 could have been purchased in 1974 (three years before the artist’s death) for $1,000.

As for the “penny stock” investor, I advise buying smaller works by big names. Some Walter J. Phillips (1884-1963) colour woodcuts can still be purchased for under $2,000. If buying work by a living contemporary artist, consider career artists with national recognition who will leave a mark on the Canadian art identity. Artists who have achieved national acceptance, through commercial galleries, museums, universities and other public institutions make a good combination with the market place.

On the other hand, it is wise to avoid highly promoted manufactured art – flashy reproductions have no artistic originality or value. Such articles are often numbered and signed to make them more appealing to the market, this does not, generally, stand the test of time. These are the .com investments of the art world. When purchasing such items, consider it decoration not investment.

Tips for the Investor

  • Be prepared to invest some of your time to become an informed buyer.
  • Seek the advice of an art professional who is involved in the investment market.
  • Stay focused on the art. The quality and value of an artwork must go beyond decorative appeal.
  • Buy with your head as well as your eyes.
  • Talk to your accountant: Did you know that original Canadian art can be purchased or leased and depreciated through your company as furnishings and fittings?
  • Buy wisely with your children and grandchildren in mind. Most investment art being sold today comes from people who have inherited it.

 

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