Introduction
Investing in contemporary art has historically been seen as risky and inaccessible, reserved only for the wealthy. However, times are changing, and contemporary art is becoming an attractive investment for those looking to diversify their portfolios. In this post, I will discuss three reasons why investing in contemporary art is worthwhile and how you can get started as an art investor.
Support Living Artists
When you purchase a work of art from a living artist, you are directly supporting their ability to continue creating art. Unlike artists of the past, many contemporary artists are still alive and actively working today, so buying their art has an immediate impact. Your investment helps ensure that important artistic voices of our time are able to survive and thrive.
Art Appreciates in Value
While past performance is no guarantee of future returns, contemporary art has been one of the best-performing investment classes over the past few decades. According to the Citi Global Art Market chart, art values have increased by nearly 150% since the global financial crisis in 2008, compared to roughly 50-90% in more traditional asset classes like stocks, bonds, gold, or property. Carefully chosen pieces have the potential for strong financial returns over time.
Diversify Your Portfolio
Contemporary art provides an opportunity to diversify your investment portfolio away from more traditional asset classes. Art returns are not directly correlated with returns in the stock market or other financial vehicles, so adding art to your portfolio can help reduce risk through increased diversification. This allows you to protect yourself from market drops that might significantly impact your other investments.
Conclusion
While the art world seems obscure and inaccessible to outsiders, contemporary art is an attractive asset class for investors seeking to support living artists, achieve strong returns, and diversify their portfolios. With research and the help of art advisors, building a contemporary art collection as an investment is within reach for those with an adventurous spirit and a desire to reap the potential financial and cultural rewards. The time is right to start investing in contemporary art.