Navigating the world of art investment requires a strategic approach. This guide introduces 3 essential rules that pave the way for successful art investment: defining your objectives, managing your budget wisely, and selecting the right artists to invest in.
Before making your initial art purchase, it’s crucial to have a clear understanding of your goals. You can start gaining this clarity by asking yourself the following inquiries:
- Is your intention to protect against inflation through art investment?
- Are you aiming to safeguard against economic downturns with your art investment?
- Does your genuine love for art drive your desire to start an art collection?
- Do you seek high-risk, high-reward investments?
- Are you more interested in slow-but-steady, low-risk investments?
- Does selling your collection for a profitable return hold utmost importance for you?
Indulging in art purchases can be a risk when you’re just beginning your collection. The exciting discoveries can add up quickly, and before you know it, you’ve exceeded your annual art investment budget within a few months.
Also, take into consideration what percentage of your total wealth you’re comfortable allocating to art investments. In my article “How much should you invest in art?” I discuss how investors commonly assign about 10% of their wealth to auxiliary investments like art.
Opting for artwork from blue-chip artists carries less risk compared to other artists’ works, making it a more prudent choice for novice collectors. Lower risk is especially advisable when you’re starting out. As you develop a clearer sense of your collection goals and a stronger grasp of the art market’s dynamics, you can consider higher-risk art investments.
My suggestion is to initiate your collection with affordable editions from renowned artists. Prints are a good starting point, given their accessibility. For those new to collecting, sculptural editions are also a viable option due to their durability and lower maintenance demands compared to more sensitive artworks.
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Check out Masterworks, Public, and Yieldstreet and explore Art Funds that let you purchase shares in million-dollar paintings from blue chip artists like Banksy, Kaws, and Yayoi Kusama.
Read more: Review: Masterworks vs. Yieldstreet
Read more: Review: Masterworks vs Public
We welcome you to Contact Us with any questions you have about investing in art. Let us know your budget, the kinds of art that interest you, and we can work out a plan to get you started with art collecting the right way.
