"Bought for" — "sold for". Examples of successful and unsuccessful investment in the arts in 2018-м
ARTinvestment.RU   16 января 2019

Working on the database of auction results, we are often able to calculate the re-sale. That is, to record when the work was sold previously and how much it could earn. The best examples of 2018 — in our review

Specific examples of repeat sales — is a very revealing illustration of the nature of the investment in the arts. We have even dedicated a separate genre free rating "returns to investment in works of Russian artists". The story of foreign victories and disappointments, of course, what-то teaches. But even more useful it is the fact that definitely adjusts new investors and potential collectors to the philosophical mood. You can select a thing correctly, by the book, but still remain in the red. And sometimes Vice versa: who is-то gets the job is pretty average and gets her "penny".

the version of the rating of re-sales over the past 12 months are available here. And in this review, only published photos of the auction and the numbers of selected transactions with Russian art 2018 — the most illustrative of those that managed to find editors our framework auction results. Rank them percent per annum and average annual nominal income in terms of dollars. I prefer the second option. It is more revealing. Because what is the use of formal 70-100-270 % per annum, when real money is 70 or 300 dollars a year? For those who want to percent, let me just say that the normal yield of work from the upper "green" part of the rating was 15-30 % per annum. Yes, among the expensive work also happened and 178% and even 242 %, but it zigzags what-то fantastic luck to rely on are seriously not necessary.

the Yield is calculated with great assumptions. She, for example, is on a simple percentage does not account for inflation and, more importantly, does not include the fee that charge auctions. You need to understand that, in practice, when selling investors receive about 20-25% smaller than specified. However, the General conclusions are not affected.

so, here are some examples of re-sales, which seem to me indicative of what-то instructive.

Comment: a Small picture, about the size of a A4 sheet, was bought at an auction in Sweden, but only a year and a half put on the most expensive auction in the world. The result is resold almost 4 times more expensive.

Comment: a Portrait of Charlot is not a masterpiece. Nevertheless, investors were pleased considerably. The painting was bought 15 years ago, at the beginning of the boom in the works of Chaim Soutine. 255 invested thousands of dollars regularly brought the owner of the picture almost 30% per annum. The strategy he used is simple but effective: buy at Sotheby's — no worries, just wait a few years — take on Christie's — resell more expensive.

Comment: Again taken from Sotheby's to Christie's. And even to wait a particularly long time is necessary. The average annual yield of the investment exceeded 22 %, or, more clearly, almost 70,000 dollars a year. Attachments were not the millions. We must pay tribute to the vision of investors. The work is very good, and the interest in the work of Zadkine now growing again.

Comment: Inspirational portrait was bought for 10 years before boom on Feshin, long before the story of "Little cowboy". Those, who in 2010 was sold for $ 10 million with 10-кратным exceeding the estimate. It is not surprising that she has since "Girl" has greatly advanced in price. But almost 40% per year it is difficult to call a trivial case. But the scheme is the same: to relate with Christie's at Sotheby's.

Comment: it would Seem that the "modest" of 10.7 % per annum in fact the money meant quite noticeable 27 thousand dollars annually for 9 years. Nesterov painting let not a masterpiece, but the thing is quite strong, and the plot is decent and the size is optimal. The risks were. But in the end the hassle the investor, she delivered not a lot. Sotheby's helped at the time to buy, and then sell at a price twice as high.

Comment: an Example of an impressive return for a small initial investment. Only 7.5 per thousand of dollars of investment in less than 6 years into a 43 thousand. A particularly successful variant, the dream of investors with an average budget. But the price of this yield — high risk. Buy small American auctions — is the prerogative of the people that are very versed in the subject and self-identity. Novice collectors out there lurking dangers of the mass — in the first place the forgery and the difficulty of return on the verge of impossible. But it all ended well. Resale at Christie's removed many possible questions.

in addition to renowned for the above examples might give the impression that the "entry ticket" to the art market is worth hundreds of thousands of dollars. In the highest League — Yes. On the masterpieces on the really expensive stuff, the result looks more attractive and impressive. For example, the leader rating yield 2018 – "Standing Nude" Nicholas de Stael, which I repeatedly wrote, — has brought its owner $1 209 173 per year on initial investment in the amount of six million dollars. The numbers are astronomical. But if you look on the table, you will find a lotexamples where people bought for $ 300 and resold for 1 500. Or bought for 1 000, and in a few years sold for 3 000 or even 10 000 dollars. And this is only the auction sales that were in our field of vision. In reality, at the gallery market in the segment of private transactions, such examples many times. As examples to the contrary — with losses at the bottom of the ranking. And they are also useful to consider.

Comment: the strange Case. For the first time this thing was sold at Christie's in 2008 for $385,000 in five years even more on Shapiro — $480 000. Then failure at Bonhams in 2014. And to help out the owner had again Shapiro. Unfortunately, in 2018, the landscape was worth more money. Why? Versions can be many. In 2013, revoked the licenses of "Master-банка". The owner Boris Baker was a member of the Board of the International centre of the Roerichs, the sponsor and one of the largest buyers of works of the artist. After the Bank's collapse, he fled abroad. By coincidence or not, but the market Roerich immediately got hot. The price index of his painting, which was at its peak in 2013, fell down. Now prices are rising again, but not a quick process. I think with the "Ladoga" worked all at once and together: the thing was bought with an overpayment (this is all-таки sketch) and then pattern additionally fell into the cycle of adverse market conditions. So, too, sometimes.

Comment: it would Seem that what is wrong with this Klodt? Great job, participant of the exhibitions of the Peredvizhniki group, an interesting provenance, publication, sale only on for an auction Sotheby's. And then on to you. The picture has fallen in price almost twice. In 10 years of ownership, approximately $30,000 in damages annually. And even more, if you subtract the auction house Commission. Explanation? Yes, just life has changed dramatically. In 2008, when he bought a painting in the Russian art market was pricing the peak. He passed and is unlikely to recur. But then who can know how things will turn out? Paid on a wave Russian boom $485 000 for the painting Klodt — is an absolute record price for the artist. His other works close to this figure not thought about. So again the same thing: a good picture has been bought from the overpayment and not on time (as we know now). Such cases are a dime a dozen. And two hundred thousand dollars, which the owner Klodt rescued now for his thing — is by far not the worst scenario.

in General, if you look again at the bottom, red part of the ranking yields, in the eye catches a pattern. Most of the "failed" works were purchased in 2006-2009. On the highs, when Russian art was booming. And according to the rules of the rating they were all sold in 2018, that is at the bottom of the market (we hope). So is it any wonder the fall of the dollar price of three times that way.Other examples are much less. But they also have. The explanation for their failure may be not only the wrong choice, but time is too short "excerpts" between bids. Typically the product need a minimum of five years to just "digest" the overpayment at auction at the time of purchase. If the investor is trying to "strike" ahead of time, it is a good chance to fix the damage.

Comment: the Painter of the Russian Diaspora, Naum Gabo (Pevsner) is pretty good and marketable author, his sculptures and drawings are regularly sold at international auctions the first row. "Linear construction number 2" — is one of the most recognizable of his sculptures. Why is she for five years has fallen almost in half? Maybe she just didn't have enough time "to otvisetsya" to gain weight. Or promotion of the artist during this period (exhibitions, etc.) was not effective. Or all together.

In General, the re-rating of profitability of sales in 2018 once again confirms that to invest in the masterpieces usually less risky than in communicating things. But the common phrase "art always increases in value" — is still a strong exaggeration. It's amazing how much good work was a failure in the investment plan. Among the formal investment of luck meet works not just below average, but even things with red indicators investment risk. Is everything. You can talk about certain probabilities. But to understand that nothing is guaranteed. Nothing is predetermined.

But all the same does not mean that the continuous around the casino, still come out as the chips fall, the lucky ones win and the brains to move useless. Fortunately, in the world of art it is not. Knowledgeable people with a developed critical consciousness by-прежнему has the advantage.

Vladimir Bogdanov, AI

What else to read on the topic on AI:
the Yield of repeat sales of Russian art in US dollars;
Yield re-sales of Russian art in annual interest.