Investing in anything can be a tough decision, whether you’re investing in property, stocks, bonds, or art. This is why it’s so important to do your research – to ensure you’re making the right choice.
In this blog, we’ll be providing you with information about art and collectables, what you should consider when investing in collectables, and the benefits of investing in collectables. Read on to learn more.
Collectables – An Alternative Investment
Collectables are a great alternative investment – they fall into a completely different category from stocks, bonds, and cash.
Many items can qualify as collectables – whether it be rare posters, comics/ comic books, stamps, trading cards and sports cards, coins, jewellery, sports memorabilia, and of course, fine art. Investing in a work of art, especially from the contemporary art world, can be exciting and incredibly rewarding.
When you invest in traditional investments such as stocks, you expect that they will return income or profit. However, collectables typically have no intrinsic value. Instead, they are typically subject to the mood and perceptions of the buyer. This is prone to change and can be affected overnight.
Investing in art, collectables and other alternative investments (also known as ‘alts’) can be exciting and incredibly rewarding. However, it can also be risky – there is no guarantee that you will be able to sell the item for a higher price.
This is a huge risk factor for many other investment assets, however, and is not unique to art investment or collectable investment.
Benefits of Investing In Collectables
There are many benefits to investing in collectables. First of all, collectables are tangible assets, you can enjoy them. For example, viewing your art every day, whether it’s hanging on your wall or on display in your office, won’t decrease the value of your art.
Likewise, collectables aren’t typically subject to inflation and low interest rates that impact your finances. Instead, what governs the collectables market is supply and demand.
Collectables are a great way to diversify your investment portfolio and give you a higher level of control when preserving your wealth.
Ultimately, investing in collectables has the potential for high returns, and can act as a hedge against inflation. Choosing something you enjoy collecting – for example, Beanie Babies, figurines, art and similar items – can also be fun and fulfilling.
What To Consider When Investing in Art and Collectables
There’s much to consider when investing in collectables, including art. First of all, the process of investing in collectables is very different to investing in stocks, for example. This is because the stock market is affected by different factors than collectables.
Storage, quality, quantity, rarity, and much more can impact the value of a collectable, and determine whether it’s worth investing in the item or not.
Valuable collectables tend to be rare/ limited edition and in mint condition. That being said, there is no clear rule when valuing collectables.
The Condition of The Item
The condition of the item is an important factor – if a work of art is in poor condition, it will likely be valued at a lower price than an item in pristine condition.
However, this isn’t always the case. If a collectable item has an important history, it could sell for more. For example, items that have been through war, or have been owned by famous people.
Banksy’s piece ‘Girl with Balloon’ sold for more than expected at auction after being partially shredded. Then changed to ‘Love is in The Bin’, the piece was estimated at £6 million – but sold at auction for a staggering £18.5 million, tripling the presale estimate.
If you’re thinking about investing in a collectable, consider how you’re going to store it. Many people will take measures to perfectly preserve their collectables, whether it be in glass display cases, acid-free boxes or storage facilities.
Likewise, assess the condition of the item. Is it worth the asking price? If you’re purchasing art, for example, a torn art print would be of a significantly lower value than a perfectly intact art print.
When buying and selling collectables, it’s important to consider the demand. Naturally, you’d assume that age correlates with the value of the item. Typically, the older an item is, the more sought after it is. This is because they are no longer being produced, meaning the affordable price often is no more.
Many people will collect items such as coins or cars. Collecting limited edition pieces ensures that there will be a demand – and the higher the demand, the more collectable an item is. This is why limited-edition items have a much higher value than mass-produced items.
Limited-edition art pieces, whether they be art prints, sculptures or paintings, are a great investment option. You can invest in limited edition prints with Grove Gallery; continue reading to learn more about investing in art with Grove Gallery.
Invest in Art With Grove Gallery
Art is one of the best collectables you can invest in. It is a unique asset class that has a low correlation with the stock market. This means that art can act as a hedge against inflation. Likewise, art can be a great way to diversify your portfolio.
Despite being an incredible investment opportunity, it can be difficult to determine which pieces of art you should add to your art collection, whether that be pop culture, contemporary art, and many more.
This is where our team of art experts can help – our team of art advisors can guide you through the process and help you to find the right piece of art to invest in, at the right time. Our art advisors will help you navigate the art market and grow your art collection.
With Grove Gallery, you can generate an average of 8% to 12% profit from art every year – with as little as £3,000. Buy art created by the likes of Banksy, Andy Warhol and Pablo Picasso to generate impressive profits.