How Art is Proving to Be a Valuable Alternative Investment

 

How Art is Proving to Be a Valuable Alternative Investment

No matter what you read about beginner investments or how to succeed in the marketplace, you’ll come across the point of diversification. It’s essential that you diversify your portfolio to cover various investment avenues. Putting all of your money into one investment is a risky choice that could cost you to lose everything.

What’s the best way to diversify your portfolio? By looking at alternative investment opportunities like art.

You wouldn’t necessarily put art and investment in the same sentence. However, many are starting to do that, and are seeing a significant return that keeps them coming back for more.

After the 2008 market crash, it took some time for investments to bounce back, but they did. Our market has been in decent shape for the last bit, but that doesn’t mean it won’t instantly change. The National Association for Business Economics found that over 60 percent of business leaders worry about a looming recession within the next year.

Now, more than ever, is it time to consider alternative investments to keep your portfolio secure. Why art, though?

 

The Resilience of Art Investments

Art investments are one that withstood the test of time. Although this may be the first time you’ve heard of this kind of investment, that doesn’t mean it is new. In fact, art investment goes back for centuries, with some not even realizing what they’re doing.

While everything else in the market could crash in almost an instant, art is one that either takes time to decrease, or doesn’t at all. Not only that, it is proven to bounce back and remain stronger than traditional investments, and our latest recession shows that. With how resilient art is, portfolio managers are finding that now, more than ever, are their clients in search of an art investment to secure their portfolio.

 

It’s Simple to Invest In

Before, when people would invest in art, it required you to purchase the masterpiece yourself. That is why you would often hear of only the rich going to auctions to collect particular pieces of art from classic artists. However, that has changed.

Although you can still find an art auction and purchase something for hundreds of millions of dollars, you can actually buy shares of art like you would invest in shares of a public company. MasterWorks is a company that allows you to do just that, leveling the playing field for American’s who want to try art investing.

 

The Demand for Art

An increase in the demand for art has put this alternative investment on the radar, but in a good way. Whenever we see a demand in something, it often draws the attention of investors. Many see the opportunity in art, besides the value it brings to your home.

The Art and Finance Industries are expected to boom in 2026, with the value increases to $2.7 trillion. A report on the art industry done in 2017 shows how this investment has evolved over the years and how it continues to grow. The first half of 2017 generated $912 million in sales compared to the first six months of 2016.

 

Additional Benefits to Art Investment

Investing in art has many benefits to your portfolio, but there are other benefits for yourself and those around you. To start, if you go the route of purchasing a piece of art for your home, you’re not just investing in your portfolio, but you’re making an investment for your house.

Purchasing a piece of artwork also helps out the artist who made it. Well over half of artists in 2017 reported making $10,000 or less per year from their art. Many don’t go into this field to make millions of dollars; they do it because it’s their passion. Your investment could help them continue to be an artist.