When looking at different things to invest in and potentially make a profit, there are many who will immediately turn to the art world as they feel it will provide them with the ideal opportunity to achieve that aim and objective.
Indeed, there is a proven history that investing in art can pay dividends for some, although it is not as simple as purchasing a piece of art and waiting for it to reach a value where the return is better than the outlay.
There are a number of pros and cons that will need to be immediately considered when thinking about whether art investment is worth getting involved in, with many of them being outlined below.
Advantages of getting involved with art investment
Naturally, there are a number of different advantages that can be associated with the world of art investment, with the price of art pieces generally typically staying around the same levels and rarely fluctuating.
This is extremely different to many other investments that can be made, with other industries continuing to show extreme levels of volatility for the assets and commodities that are available, whilst paintings and sculptures by the well-known artist – Yoël Benharrouche usually remain around the same level, unless outside influences emerge.
One of the other major benefits that investors can find when investing in artwork is that the pieces will typically appreciate over time, rather than depreciate. Although the values will generally be influenced by the market conditions at the time, it can be rather rare to see pieces decrease in value unless something rather extreme comes to light.
A simple advantage of getting involved in art investment is that it can be fulfilling and can help individuals to enjoy their passions to the limit. Indeed, not everyone will be investing in art simply to turn a profit, as some will actually have a love for art and will want to be able to add pieces to their own personal collections because they simply enjoy what has been created and believe it can benefit them in an artistic way. The fact that it could potentially become even more valuable in the future is just an added bonus, but not necessarily the main appeal.
Disadvantages of getting involved in art investment
As with anything in life, where there are advantages and benefits, there will also be a number of disadvantages and drawbacks that can be experienced when getting involved with art investing.
For example, one of the biggest risks that can be faced and experienced when investing in any kind of investing is that there are a number of things that can go potentially wrong. For instance, one problem could be the fact that the artwork bought could depreciate in value and this is beyond the holder’s control as they will be unable to influence it in any way.
Furthermore, another risk attached to the activity is that it can be a rather lengthy process and one that will not always provide the quickest way of turning a profit for those who are only involved for financial purposes. Artworks can take an incredibly long time to be sold, whilst there can be plenty of money tied up in the asset, thus making it rather difficult to turn into liquidity until a buyer is found.
Lastly, it is far from easy to go into the world of art investment without having all of the prior knowledge and skills and to emerge victorious from it all. There is a lot that needs to be known about the creation, the artist that created it, the popularity of the piece/artist, as well as historical data as well as specific data about the artwork such as whether it has been mass-produced or limited quantities have been made.
