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What are the ways people can/do people invest in art?

Or what strategies are there?

In company investment, off the top of my head, you can:

  1. Invest in index/managed funds
  2. Invest in start ups/rising stars (IPOs, VC)
  3. Invest in companies which seem undervalued (e.g., Warren Buffett)
  4. Day trading (making bets/arbartrarging info/time

Only 2 and maybe 3 seem possible with art investment.

Is that correct, or are there 'managed funds' of art investments?

closed as too broad by Pete B., Nathan L, Dheer, JoeTaxpayer Sep 25 '18 at 12:10

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  • There do appear to be... this Art Fund Association page may be of help/interest. – TripeHound Sep 21 '18 at 7:14
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    Can you reword the question. Are you asking about how to invest in art work like paintings, jewelry, sculptures, ancient items that are expected to rise in value? – Dheer Sep 21 '18 at 7:14
  • There's no such thing as investing in art. It's like investing into playing roulette. You're merely gambling. – Davor Sep 21 '18 at 13:35
  • hi @Davor - it could be you are thinking of something else, or have bad information. Investing in theoretical intangibles (ie: stocks) is simply gambling (like guessing on horse racing). Investing in tangibles (ie - basically antiques) is totally tangible and real. For example you can literally state how many Vermeers or Picassos there are in the universe. Only real estate is similarly as tangible (although real estate can be taken away from you any second by the local sovereign authority - you never really own it.) ... – Fattie Sep 21 '18 at 15:12
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What are the ways people can/do people invest in art?

You invest in art by purchasing art. Christie's and Sotheby's are the two "world-famous" auctioneers of antiques, "old" art (for want of a term) and modern art, but there are many regional auction houses and specialists in almost everything (whether "vintage cars", "books", etc etc etc). There's also (for want of a better term) "novelty" art, things like baseball cards, cels from Animes, etc etc (some of which have performed incredibly well indeed over the last century)

What strategies are there?

The strategy to all investing is that

  1. you guess what you think will go up. (Example: real estate: you think Seattle real estate is going up and LA real estate is going down.)

  2. you then buy that thing. (In the example, you'd buy Seattle real estate.)

This is the only "strategy" to investing. You are guessing what will go up.

This applies identically whether you are investing in real estate, antiques, art, stocks, commodities, gems, wine, or any other category.

index/managed funds...

Yes, there are many "art" funds in all sorts of categories (antiques, gems, modern art, classical art, etc etc).

Don't forget that stocks (ie, the world's couple thousand biggest stocks) are very liquid, and things like physical gold are very liquid; whereas real estate and "art" is less liquid. It can take ages to sell some land or say paintings.

(Similarly things like stocks/bullion have very low transaction costs, whereas physical tangibles (houses, Picassos etc) usually have high transaction costs.)

Conversely, "art" (antiques, paintings, etc etc) are tangible (they are absolutely real - precisely N Vermeers exist, and that's it) whereas stock instruments are just a thin-air abstraction.

Hence,

day trading

as you imply there is really no "day trading" of tangibles to speak of. One example is the market in wine (whether "futures" or cases); which was pretty hot for awhile and you could trade it in a rapid, day-trading-esque manner. But yes there is really no fast, day-trading analogue for tangibles like antiques or real estate. (That being said there are REITs which you can trade pretty fast, but they fall apart in banking/real estate crisis.)

The raison d'etre of tangibles is that you hold them in your hand (well, safe!) and that's the end of it - no "crisis", broker, regulation etc can take them away. This is probably why historically all "wealthy families" in all socio-historic settings, have held a large amount of their wealth in physical tangibles (ie - art, antiques, etc, as well as of course real estate, with the caveat that you only "own" real estate due to a sovereign power saying you do).

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Yes, there are indeed art funds, which are essentially mutual funds that buy and sell works of art.

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