Investing in art may be a great idea if it’s something you truly love. But it can be risky, so you need to do your research.
Art can do more than brighten a living space. The art market has become one of the hottest new investment crazes in recent years. Painting and sculpture collectors frequently buy pieces with an eye towards adding to their investment portfolio.
But will art investment really earn you a profit? Or is this new asset class mostly hype?
Art is a long-term investment
Profits from art won’t happen overnight. Experts recommend art investment for patient investors with a time window of 10 years or more, so think long term.
Many art investors include paintings in their estate planning as assets to pass on to their descendants.
The art market follows rules of its own
One major perk of art as an asset is that its value doesn’t rise or decline with the stock market. Even if your stocks aren’t performing well, your art investment may be doing great—good news for the savvy investor who wants to diversify a portfolio and minimize risk. And ideally, though not always, art will continue appreciating in value over time.
Art is risky
Every artwork is unique, and the art market has ups and downs just like any other market.
Since it’s impossible to determine an artwork’s true value—a lot depends on the artist’s reputation and on the economy as a whole—you should be c