When you are looking to acquire a new investment product aimed at diversifying your portfolio, it is important to choose well, especially in these times when the world is changing. How to avoid mistakes? This is a crucial element you must take into account in order to grow your estate. The security of the financial product you will choose is based on 4 pillars. You end up interested in a very attractive and secure – but still rather unconventional – product. You want to know more about it? We are happy to guide you.
Financial product: 4 pillars
Indeed, you must be sure that this investment method has a solid foundation. Of course, this is important for all serious financial products. As for us, we offer you the opportunity to invest in art. This is not a classic investment; and yet, it can prove to be very profitable, provided you use the 4 pillars method offered by Art Trading & Finance, a company specialized in both art and finance. This method has proved to be effective. It offers medium and long-term profitability, as long as you follow these 4 principles.
Art Trading & Finance is a company based in Geneva but active worldwide. It is at the leading edge of this unique investment which combines art and finance. Here is an overview of how this still little-known method works. Yet, it can be promising for you when you are supported by experts in these two intertwined fields.
First pillar: analyzing the price evolution chart of the selected artist
It is especially important to analyze the evolution of the prices with the mindset of a financier who is also a great art collector. For instance, this is how we realize that a safe bet like Auguste Rodin has seen its rating skyrocket by 65% in 18 years.
Despite being a stable investment, we notice that it is interesting nonetheless.
We can have another perspective, that of contemporary art. At first glance, this approach seems to require a greater risk tolerance. However, we can end up with a truly extraordinary profitability. For instance, with prices soaring by more than 4000% in 15 years, as in the case of the painter Jean-Michel Basquiat.
In both cases, it is important to analyze the artist’s rating curve with the mindset of a scientist and a financier.
Second pillar: estimating the price beforehand
If he plans to integrate this innovative element into his portfolio, even the greatest art enthusiast cannot improvise an estimation of the purchase price as well as the selling price that he’s counting on afterwards.
This is why it is important to call on experts to diversify one’s portfolio. It is, of course, essential to make a correct financial assessment of this purchase.
In order to succeed in materializing such an investment, these two artistic and financial disciplines must be combined. This is not an easy thing to find; whereas these two separated specializations are legion.
Art Trading & Finance offers you this innovative double approach thanks to the support of experienced and passionate experts.
Third pillar: the geographical distribution of the portfolio
It is essential to distribute the geographical and geopolitical risk well in order to build up a healthy estate.
Art Trading & Finance can also provide you with sound advice in this respect. It is especially interesting to include artists from developing countries or continents in a portfolio – countries such as Cuba, Iran or Nigeria. But there are many other examples.
The rating of the artist whose works are included in your portfolio can then benefit from a growth in line with the macro-economic development of the respective country.
Fourth Pillar: distributing the allocation of your art portfolio properly
Ideally, according to Art Trading & Finance, you should also diversify the amount allocated to your art portfolio between modern and contemporary art.
With an ideal investment of 80% in modern art - the safe bets - and 20% in contemporary art, the distribution is optimal. Therefore, you are guided both by your personal preference and your financial perspectives.
This harmonization of your portfolio must of course be adjusted with you in accordance with various factors: the amount to be invested, the investment period, and more precise data on your particular situation.
In conclusion, we are convinced that this financial approach is as suitable for art enthusiasts as it is for traditional investors. In any case, it is indispensable that this investment be further complemented by a thorough analysis of the 4 pillars, which are briefly outlined here.
In this respect, you will find more information on the thoughts and works of Michel Santi, co-founder of ATF, macroeconomist, independent financial adviser to central banks and art collector. Indeed, he had the drive to blend these two skills together, art and finance, with passion, like everything he does.
If you want to discover the world of Art Trading & Finance, feel free to contact us. We will be happy to guide you.
Your team at ATF
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