The intricacies of art investing

A question from Askville:

Everyone dreams of being the first to recognize the genius artist before he or she hits it big. Wouldn’t it be great to buy his or her work at a time when it is still affordable? Do you know someone who is living in obscurity now, but is a future Van Gogh? If so, who and why? Link to examples of his or her work if possible.

Trying to find the next van Gogh will get you nowhere. Art investing is all about diversification and risk control. To diversify, you need to be able to hold a large number of pieces (a hundred is a good starting point) for extended periods of time. To control the risk of buying worthless art, you should avoid buying art from artists (unless you are an expert) and only buy art that already found its way to the auctions (or combine the best of both worlds and buy art from artists whose other works have been auctioned before). This said, you should avoid buying through major houses, Sotheby’s and Christie’s (other things being equal, an item sold through a major house sells more expensively), while making every effort to sell through the major houses.

1 thought on “The intricacies of art investing

  1. Allen Taylor

    I found your site on technorati and read a few of your other posts. Keep up the good work. I just added your RSS feed to my Google News Reader. Looking forward to reading more from you.

    Allen Taylor

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