Art is not only a form of expression, but also a potential source of income. Many people are interested in investing in art, but they may not know where to start. Here are some tips for beginners who want to enter the art market.
1. Do your research. Before you buy any piece of art, you should learn about the artist, the style, the history, and the value of the work. You can use online databases, books, magazines, and experts to gather information. You should also compare prices and sales records of similar works to get an idea of the market value and demand.
2. Set a budget. Art can be expensive, so you should have a clear idea of how much you are willing to spend. You should also factor in other costs, such as shipping, insurance, taxes, and fees. You should also consider the potential return on your investment, and how long you are planning to hold on to the piece.
3. Choose a reputable source. There are many places where you can buy art, such as galleries, auctions, fairs, and online platforms. However, not all of them are trustworthy or reliable. You should do some background checks on the seller, the authenticity, and the condition of the work. You should also read the fine print and understand the terms and conditions of the sale.
4. Follow your taste. While investing in art can be profitable, it is also a personal and emotional decision. You should buy art that you like and enjoy, not just because it is popular or trendy. You should also trust your instincts and intuition, and not be swayed by hype or pressure.
5. Diversify your portfolio. As with any investment, you should not put all your eggs in one basket. You should diversify your collection by buying different types of art, such as paintings, sculptures, prints, and photographs. You should also buy art from different artists, genres, periods, and regions. This way, you can reduce your risk and increase your chances of finding a gem.
6. Keep up with the trends but don’t follow blindly. The art market is constantly changing and evolving, so you should stay updated on the latest developments and innovations.
During the pandemic, one of the hot trends was buying **NFTs**, or non-fungible tokens, which are digital tokens that represent ownership of unique digital assets, such as artworks, memes, or GIFs.
NFTs sold for millions of dollars making some artists and collectors very rich.
However, recently, some reports have shown that “the NFT market has essentially collapsed”, and “nearly all NFTs are practically worthless” . According to a study by dappGambl that analysed 73,257 NFT collections, 95% of them have a market value of zero ETH. This means that more than 23 million people’s investments are now worthless. Even iconic NFT collections such as Bored Apes Yacht Club and CryptoPunks have seen their prices drop significantly. Therefore, you should be very cautious about buying NFTs as an investment strategy.
Investing in art can be a rewarding and enjoyable experience if you follow these tips and do your homework. Art can enrich your life as well as your wallet if you know what to look for and how to buy it.
Are you looking to investing in art? Check out the Horizon Food & Art Fair happening at Avenue K Shopping Mall Kuala Lumpur from 4th-8th October 2023. Get your tickets here
To reach the My Money Insights editorial team on your feedback, story ideas and pitches, contact us here.
