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Another article about how to invest in art. In itself it - nothing special. I translated it, because it seemed to me that the information about mutual funds investing in works of art, can someone interested.


The Art - the market, available to all

Financial Gazette (Journal des Finances), 26.07.2008

Despite the financial crisis, the latest auction from Christie's and Sotheby's show the dynamism of the art market. However, judging by some indicators, recession looms easy. In the works of art can be invested to diversify their investments, but subject to certain rules.

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Nine million pounds! This is - the profit realized actor Hugh Grant in the sale of a portrait of Warhol, Liz Taylor brush acquired them for £ 2 million ... Can envy instinct British actor.

This gain is well illustrated by the current fascination with some artistic currents. Thus, the quotation from the contemporary artists of 1993 soared by 160%- you want to compare this result with 135%CAC-40 (French stock market index of blue chips) and 200%Dow Jones for the same period.

However, art lovers should not sink into sweet dreams with a dizzying rise in prices for some artists, as well as B of Most of the art market research shows that the profit from investing in this market yield profits from buying shares.

Investing in art subject rather a desire to diversify their long-term investment than the desire to obtain quick profits, even if such profits were possible in the 1990's.


There are various ways to participate in the art market

According to Karl Schweitzer, head of Art Banking at UBS (Union of Swiss Banks), "there is no standard percentage of capital that can be invested in works of art. Everything depends on income ... But you should not invest in art is too much of its liquidity, if they may soon be needed. And it is clear why: the work of art does not generate regular income. When a record being entered works of famous artists, novice investor might think that this market is not available to him - and indeed, Bacon triptych left in May 2008 for $ 86 million.

But we should not refuse to participate in this market. There are different ways to invest in it. To purchase a work of art is a famous artist or part of it, the investor can enter a fund that invests in the art market. The most reputable fund has «Fine Art Fund», managed by former CFO of Christie's, Philip Hoffman (Philipp Hoffmann). To enter it, you need to make 250,000 euros. This fund allows its shareholders to keep their own homes is one of the products purchased by the fund.

There is also a Russia fund, run by Vladimir Voronchenko, there is a Chinese fund managed by former staff member of Sotheby's, a specialist in Oriental art by Julian Thompson (Julian Thompson); Is Art Trading Fund, initiated by Chris Carlson (Chris Carlson). The latter fund is maintained as a hedge fund, income from investments may be obtained through 3 - 12 months.

Karl Schweitzer, a rather critical view of all these funds: "None of the existing or existing funds, with the exception of standing in a very special situation of British Rail Pension Fund, did not bring profits to investors."

In addition, organized "teams of Contemporary Art", allowing teamed and buy a piece of art together. These groups of customers, which usually recommends an expert or a well-known member of the art market are a practical way to participate in this market, but today they are still not very well known and difficult to find. And in Belgium, and France there is the emergence of such groups. Helen Demmerle, an adviser to investment in art at UBS, explains: "These groups are investing in lesser-known artists. They are largely based on his taste.

Finally, contrary to established opinion, the price of works of art does not constitute an insurmountable obstacle. Indeed, 78%of transactions in the field of contemporary art in France were subject to the product, price not exceeding 5000 euro, trading at half of the items purchased is less than 1000 euros.

In addition, when buying works of art can be advantageous conditions. So, galleries usually provide customers the ability installments for several months at no additional cost. Project of the French Culture Minister Christine Albanel provides encouraging banks to lend up to 7000 euros with a zero per cent for all investments in the arts.


«Art - this is how the Chinese language, it is possible to learn»

Money - not all, participate in the art market also requires a "good eye", that is, artistic culture and a certain curiosity. "Art - this is how the Chinese language, he can learn." This knowledge acquired by visiting museums and galleries, studying catalogs of auction houses and specialized literature, regular viewing of specialized sites.

Some private banks are providing assistance - for example, Crédit Suisse reduces its clients with independent experts who are chosen depending on the client's interests. In France, from 30 to 40%of transactions occur at the auction. Fans of public bidding is well-known nuances of behavior in these places. You need to visit an exhibition of items that will be the next day for sale, and to consider carefully chosen piece, and always as fast as they can be more subtle, and not to arouse the public interest in the subject. Bidding can rise very quickly, but if the reserve price is not reached, the object remains in the auction house, and after 15 days you can buy one auctioneer, agreeing with him about the price.

The advantage of buying in the galleries - no additional fees. Delphine de Kozan, collector, explains: "Price, called the Gallery in advance will provide a discount, which can reach 20 %».