Investing in art

24 JUL, 2011, 10.11AM IST, NALINI S MALAVIYA,ET BUREAU

Investing in art needs some research

With reports in the media focusing primarily on the merits of investing in art and making it appear as an attractive option for all investors, it raises a lot of questions for investors who are attracted to art as a financial investment instrument. Art can undoubtedly give huge returns in the long term, but there are many layers to it, which may not be immediately evident to nouveau buyers, but are nevertheless present and hence require a healthy understanding of the workings of the art market.

It is important to consider various aspects related to investing in art for instance, the risks associated with it, its liquidity and also how it fares against other investment assets. It is inadvisable to consider art from a purely financial investment angle; after all, it is one of the few (such as antiques and collectibles) options which has a ‘decorative’ side to it. It would therefore be rather inappropriate and superfluous to override the aesthetics and visual content of art.

One should consider investing in art only after allocating funds to conventional assets such as stocks, real estate and gold. Also, consider art as a long-term proposition and keep in mind that it may take some time to sell it off when necessary.

Most people who have made a lot of money through art are those who bought works at low prices by artists who would have then gone on to establish themselves in a big way later on. However, it is important to realize that not every artwork will appreciate considerably in the future - prices are likely to increase with time corresponding with the artist’s career but not all will show a significant change or a dramatic graph. This implies that the element of risk is probably high when buying artworks priced in the lower bracket range. Art which is priced higher and is done by established artists is a safer option in terms of investment, but requires a larger outlay from your part. It is also essential that as a buyer or investor you have some knowledge of art and understand the dynamics of the market to an extent.

Investing in art needs some research

24 JUL, 2011, 10.11AM IST, NALINI S MALAVIYA,ET BUREAU

With reports in the media focusing primarily on the merits of investing in art and making it

appear as an attractive option for all investors, it raises a lot of questions for investors who are

attracted to art as a financial investment instrument. Art can undoubtedly give huge returns in

the long term, but there are many layers to it, which may not be immediately evident to nouveau

buyers, but are nevertheless present and hence require a healthy understanding of the workings

of the art market.

It is important to consider various aspects related to investing in art for instance, the risks

associated with it, its liquidity and also how it fares against other investment assets. It is

inadvisable to consider art from a purely financial investment angle; after all, it is one of the few

(such as antiques and collectibles) options which has a ‘decorative’ side to it. It would therefore

be rather inappropriate and superfluous to override the aesthetics and visual content of art.

One should consider investing in art only after allocating funds to conventional assets such as

stocks, real estate and gold. Also, consider art as a long-term proposition and keep in mind that

it may take some time to sell it off when necessary.

Most people who have made a lot of money through art are those who bought works at low

prices by artists who would have then gone on to establish themselves in a big way later on.

However, it is important to realize that not every artwork will appreciate considerably in the

future - prices are likely to increase with time corresponding with the artist’s career but not

all will show a significant change or a dramatic graph. This implies that the element of risk

is probably high when buying artworks priced in the lower bracket range. Art which is priced

higher and is done by established artists is a safer option in terms of investment, but requires

a larger outlay from your part. It is also essential that as a buyer or investor you have some

knowledge of art and understand the dynamics of the market to an extent.

(Published in Financial Times)

Art in Home Decor

1 MAY, 2011, 06.03AM IST, NALINI S MALAVIYA,ET BUREAU

Buying art as an investment option

Now that the recession is considered to be behind us, people are once again looking at various investment options. Real estate, gold and the stock markets are taking precedence as investment avenues. Many are investing in their dream homes and are willing to spend anything between Rs 50 lakhs to Rs 1.5 crores, while others are buying their second or even third houses. There are people keen on doing up their homes to the best of their ability and are willing to spend substantial amounts on the interiors. As part of this process, homeowners are increasingly considering original artworks as an essential element of decor.

It is noticed that in such cases the prime focus is on purchasing a work of art which fits in well with the space and the interiors, rather than be driven by a purely investment motive. Although, this is a positive trend and must be encouraged, what would work better is if the buyers choose art with a right amount of emphasis on aesthetics , and at the same time consider a few points, which can contribute towards building up an art portfolio in the long run.

While buying art, you can consciously opt for original artworks (instead of reproductions or prints) by emerging artists, students or established names depending on the budget available. Drawings, limited edition prints such as etchings or serigraphs, watercolours and photographs are some of the options which are priced lower than oils and acrylics on canvas . Canvas works by students and young artists are also likely to be more affordable in comparison to paper works by senior artists.

Most people tend to buy art according to specific colour themes or motifs in an effort to coordinate with the existing decor, but this may not always be the right approach to adopt. When buying, the emphasis should always be on the quality of the artwork, while keeping other aspects in mind.

Building an art collection

24 APR, 2011, 06.25AM IST, NALINI S MALAVIYA,ET BUREAU

An art collection can be a viable investment option

Building an art collection can be a rewarding experience, both aesthetically and as a viable investment option . It is important to realise that significant collections are not built overnight, but tend to evolve over a period of time. Very often, they are driven by the collector's tastes and preferences, especially in the initial stages. However, later on, they may evolve and get refined further due to a conscious effort.

One may decide to collect works from a certain period, school or region. He may decide to focus on one aspect or may opt to diversify and collect representative works that cover more elements. As a result, most art collections are highly indicative of the buyer's choices. This is especially true in the case of collections built by individuals .

A corporate art collection or one owned by a museum is likely to have a different approach altogether, more so in the case of the latter. Incidentally, there are a few banks, who own some of the finest art collections in the world. For corporates, hotels and institutions it makes a lot of sense to collect art as it can grow into something significant with time and become a source of joy and pride.

When storage becomes a problem most people prefer to build a separate space to display the works. And, it can be seen that when most individual collections evolve to an extent they may requires a s u b s t a n - tial amount of space and effort to house and display them. Very often, these spaces are then opened to public for viewing. In India, a large number of art collections are privatelyowned and many of them have been converted later on into museums that allow public access.
When collecting art, it is important to periodically review the artworks and see if some of them need to be sold off to either make space for new works or in order to build a more coherent compilation.

Collecting art

(By Nalini S Malaviya)

Most people who have enviable art collections are those who began collecting randomly and often just by chance. Most of them began collecting in the sixties and the seventies when collecting art was not in fashion and it definitely had not become a fad then. Buying art for the sake of financial investment was completely unheard of; nobody could imagine that one day these works of art would appreciate to the extent that they have.

These were then a few scattered individuals who bought art out of a passion for it and that too at very reasonable rates. It was not uncommon in those days to buy art for a few hundred rupees to a couple of thousand. Although, these amounts were considered to be exorbitant for those days, but when we look back, we can only marvel and feel nostalgic. Today it is unlikely that you could buy a work of art for anything less than Rs 10,000.

Collecting art is quite different from investing in art, although both can become synonymous with each other. The advantage with building an art collection is that one passionately buys only those pieces, which engages him or her, and over a period of time the collection can become quite significant and valuable both in terms of its monetary worth and its historical value. On the other hand, people who look at art purely from an investment angle tend to look at things very clinically, still it is quite possible that they too amass a significant body of work over a period of time if they retain it and not tried to sell artworks frequently.

As collectors believe in holding on to their works for longer durations, their collections grow much more as a financial investment even though that may not have been the primary objective. Most collectors are wealthy and have the capacity to tide through recessional times and they remain largely unaffected from the ups and downs of financial markets. This is a major advantage that they have, which normally other investors may lack and which is why it is important to consider art as an asset class only when one is diversifying their investment portfolio. On the whole, for those who can afford to, collecting art can be extremely rewarding in more ways than one.

(Abridged vn published in Financial Times)

Photographs as a medium of expression gaining in popularity

10 APR, 2011, 04.17AM IST, NALINI S MALAVIYA,ET BUREAU

As is widely evident, photography as a medium of expression has grown in popularity over the last few years, and has become a highly collectible item. Initially, most people looked at photographs as an affordable option and as an alternate to conventional art forms.

However, the prices of photographs have risen consistently over the years. Still, due to multiples, prices of photographs are comparatively lower than conventional art such as paintings.

During this year's art summit too there was ample emphasis on photographs, with dedicated galleries showing their works. Overall too, the number of exhibitions , photographers and the range of work that is being displayed have expanded tremendously, which augurs well for the collector or buyer.

It does, however, become difficult for buyers to assess whether to invest in photographs or not. In the conventional art market, not every painting or sculpture can provide financial returns, and the same holds true in the case of photographs. There are numerous exhibitions now by both established photographers and budding ones. Therefore, one must put in an effort to understand more, to be able to assess good quality works and in general to get familiar with the medium.

What makes this field particularly interesting is that there is a whole spectrum of photographic works on display . Photojournalists, fine art photographers, conceptual artists, they are all producing some exceptional works and although this is exciting for the viewer and the market, it can be a little confusing for first-time buyers .

It is imperative therefore that one gets familiar with the scene completely before buying. You could begin by looking at works of established photographers to understand the finer nuances of the medium. As always, it is important to buy from galleries of repute and to check the edition size of the photograph.

It does, however, become difficult for buyers to assess whether to invest in photographs or not. In the conventional art market, not every painting or sculpture can provide financial returns, and the same holds true in the case of photographs. There are numerous exhibitions now by both established photographers and budding ones. Therefore, one must put in an effort to understand more, to be able to assess good quality works and in general to get familiar with the medium.

What makes this field particularly interesting is that there is a whole spectrum of photographic works on display . Photojournalists, fine art photographers, conceptual artists, they are all producing some exceptional works and although this is exciting for the viewer and the market, it can be a little confusing for first-time buyers .

It is imperative therefore that one gets familiar with the scene completely before buying. You could begin by looking at works of established photographers to understand the finer nuances of the medium. As always, it is important to buy from galleries of repute and to check the edition size of the photograph.

(Published in Financial Times)

Innovations in art: Mixed media paintings growing popular

27 MAR, 2011, 02.54AM IST, NALINI S MALAVIYA,ET BUREAU

These days, many artists are moving away from traditional media such as oil and acrylic on canvas or watercolours, and are experimenting and innovating with various materials. Mixed media paintings or installations have become the in-thing and are increasingly growing in popularity. These are exciting to view and often feature creative uses of different materials to present the concept.

However, for the buyer, it is important to verify or at least be aware of the materials, which have been used as part of the artwork. This will give an idea as to whether these will maintain status quo, or if there is a probability that one or more of the materials could decompose, decay or rust, change colour or texture due to oxidation or reduction based on environmental conditions.

While some of these changes may be desirable (adding interesting dimensions to texture or patina), those that affect the monetary worth of the artwork could be unwelcome. In fact, there might be instances where one may not be able to foresee some of the changes that may happen in the future. Over the years, a lot of research has taken place to improve the quality of paints, pigments and canvases to ensure that they are longer lasting.

But when artists use 'different' and new materials, which are not as common in artworks, there has to be a conscious effort made towards ensuring the longevity of the product. This could be done either by treating these materials appropriately or by substituting them with similar but hardier materials. Therefore, while it might be exciting to view artworks made out of interesting materials, as a buyer, one needs to be aware of their condition and expected lifespan.

Fortunately, just as many painters have adopted the use of finest quality materials in their paintings, most new media artists too put in a lot of effort in using the best quality materials. Still, as a buyer, there is no harm in being aware and then taking an informed decision.

(Published in Financial Times)

Essential to understand markets while investing in art

13 MAR, 2011, 05.27AM IST, NALINI S MALAVIYA,ET BUREAU

For those who are looking at buying art, it is important to tread cautiously at this point in time and do a thorough background check before investing large sums of money in it. One does not want to repeat the same mistakes which were made prior to or during the boom phase. What is positive is that there is a lot of interest in art, and there are many collectors and buyers who would like to invest in art. Yet, there is a slight hesitance due to past experience , which may not have been pleasant.

One of the best ways to go about it is to empower yourself to be able to make the right judgment about artworks, artists and prices. Therefore, it only makes sense to learn more about how the art market functions, the factors that influence and affect prices, how to choose the right gallery to buy from and most importantly , how to ensure that what you are buying is at the fair market price.

One of the things that were very common a few years ago was the trend that prospective buyers, essentially young professionals with disposable income, would approach art galleries with a specific amount of say, Rs 5-10 lakhs and request them to suggest artists or to even create a portfolio. The drawback with such an idea is that although a gallery of repute would ensure that your money is invested safely with appropriate buyback options, flyby-night operators would be bound to take advantage of such an offer.

Today, it would be wiser to either approach established, reputed galleries or professionals, or to research as much as possible before buying. This way, the responsibility of decision-making is in your hands, which is not only prudent but also enhances your involvement in the whole process.

(Published in Financial Times)

Buying art

There is no denying that there is a lot of interest in art these days. There are a number of new entrants in the form of galleries, dealers, curators and of course artists on the scene. Also, there are a number of people now who are buying art for the first time and find themselves at a loss when it comes to deciding about the artwork itself. They find themselves wondering what to buy, where to buy from, is the pricing fair, while facing a hundred other dilemmas.

One of the most important things when it comes to buying art is to make sure that you always buy from credible sources. It is imperative to set aside a budget and determine whether you are looking at buying art as a one time option or are you considering making art a part of your investment portfolio. In the latter case, you might be looking at buying several pieces spread out over a longer period of time. Very few people indulge in impulsive buys, unless the work is really affordable, but even then it helps to set aside an amount dedicated to art. In case, you are buying art to diversify your investment portfolio it might be advisable to consult a financial or investment advisor who is knowledgeable about art.

If you are visiting an art gallery either to buy or just to look at art, you need not be intimidated by the staff or the gallery ambience and make sure you ask all the right and relevant questions which can help you garner information regarding the artwork, the artist and his/her antecedents. Incidentally, people are a lot friendlier now than they were earlier, making it easier for the buyer. It is also perfectly normal to not make an on the spot judgment but to come back with an informed decision.

The track record of the artist for the last five years at the minimum can offer some insight into his/her price growth and overall demand. However, if you are in doubt then do not hesitate to take expert help, someone with the right credentials and who you can trust with your money is a good advisor.

(Published in Financial Times)

Changing profile of art buyer

In the olden days, which some would say were the 'good old days', people who bought art did so either because they had a passion for it or to help out a friend. The last thing on their mind during those days was to make money out of it. Then, in the late nineties, it was evident that art could be seen as a viable financial investment.

That insight played a huge role in altering the mindsets of buyers and collectors, and also in changing the dynamics of the art market significantly. Buyers realised they could make a quick buck by buying and selling in quick succession, which was amply aided by the booming economy. This trend lasted till the recent recessionary period, when it became clear that just as any other market which had grown too fast too soon there were huge gaps in infrastructure and systems.

In the meantime, it had become fashionable to collect art or to be seen as a patron of the fine arts, and again, the fast-growing economy acted as a catalyst in supporting luxurious lifestyles. Art was a conversation piece and adorned the homes of all those who could afford it.

Then there was a phase where there were a number of art funds in the market catering to a clientele that was not interested in art, but only in the dividends that it could offer. However, the recent economic downturn has been an eye-opener of sorts, in many ways.

There was abundant disappointment and disillusionment, especially for those who had entered the business of buying and selling art without understanding either the art or the dynamics of the market. But it may have contributed towards a more aware and knowledgeable collector and investor base, and overall, in the establishment of a more mature market. Today, loyal collectors are continuing to buy art with a renewed focus on quality. There are a few investors in the field.

They are treading cautiously and short-term investors are wary of making the same mistakes again. The young, upwardly mobile professional is still interested but not completely convinced or confident. For all practical purposes this continues to be a transition phase and the next few months where activities will increase may help in determining how the situation unfolds.

(Published in Financial Times)

Art exhibitions gather momentum in the art market

It is a delightful season for connoisseurs, as there are a number of art exhibitions happening all over the country, especially in the Capital. Most exhibitions are group efforts, either curated or gallery collections that are offering a wide range of contemporary art to the discerning buyer. However, it is interesting to note that there is plenty of overlap in the artists between the various shows.

Most galleries are now opting to play it safe. Their focus at the moment is on the middle bracket that is considered to be a safer option compared to new and upcoming artists. This is not surprising given the recent trend where art prices went through a major downfall during the economic recession. Incidentally, modern artists and other established artists are not as much in the spotlight for the simple reason that their prices are quite beyond the average buyer.

Spoilt for choice, the buyer or investor is not complaining. To look at it this way, it offers a wider choice to the buyer as the same artist's work is available at several venues in the same city or across cities, simultaneously or within a short period of time. On the flip side, most works from the same series tend to look similar, and there might be very little difference between the works that are available even at separate venues or cities.

The emphasis now is on salability and galleries are doing their best to ensure that the works are not only saleable but also the artists are reliable names from a long-term perspective. The loss in confidence that was seen earlier needs to be addressed. It has to be re-instilled in the buyer and investor, and most reputed galleries are doing their best to make art an attractive option once again.

However, there is a possibility that overexposure could have a negative impact and could lead to buyer fatigue as well. The onus lies not only on the gallery, but also with the artists and curators.

(Published in Financial Times)

Quality materials ensure better resale value

A poor quality canvas or paper will not last long as it is more susceptible to mold and degradation as a result of environmental conditions. When you are spending so much on a work of art, it is only reasonable to expect it to last for years to come, and it is a known fact that the condition of an artwork affects its resale value as well.

Cheap or low-grade material will degrade faster, thereby affecting its overall lifespan and may require higher maintenance and even frequent restoration in the interim period. Fortunately, excellent quality paper (for paintings and photographs), canvas and pigments are now available in the country and that too at reasonable costs. Established artists do ensure that they opt for the best-available materials and rarely cut corners.

Earlier, when options were limited, and better canvases and pigments had to be imported, buyers too were more forgiving. But today, when everything is easily available off the shelf there is no excuse for inferior choices. Therefore, even if the painting is of excellent quality, it is not enough. Paper is especially prone to wear and tear, and one needs to be extra cautious when buying them.

Good quality paper that could last for almost a century without significant damage is available in the market and many artists use it as well. In short, as a buyer you have every right to question and find out more about the materials which have been used in the artwork in order to safeguard your interests. It is important for everyone to be quality-conscious, and if galleries and buyers insist on it, compliance will improve and all artists will shift to better-grade materials in order to sustain the works.

(Published in Financial Times)

A look at the market for experimental art

(By Nalini S Malaviya)

It can be observed that a large number of art exhibitions these days focus on conceptual and experimental art. These exhibitions are sometimes organized in mainstream galleries or more often in alternative spaces, which thrive on experimental art. Such alternative spaces are usually associated with artist residencies or collectives and provide a much needed impetus to alternative art practices.

It has therefore become fairly common to see emerging artists experiment with new media and avant-garde art. However, in terms of sales, experimental art is yet to strike a chord with a broader buyer base. Most buyers have a conservative approach and prefer to opt for traditional mediums such as paintings and sculptures for their homes or private collections. This trend continues, although today there is a growing tribe of people who appreciate and also invest in experimental art. In the past, we have seen collectors vying for paintings by S H Raza and Tyeb Mehta amongst others and in the process breaking all previous auction records. Most private museums (with a few exceptions) also tend to focus on collections of modern and contemporary art, yet there is very little space for experimental works.

Still, there is no real reason why people should refrain from buying experimental art, especially if it is of good quality. Interestingly, the quality of such artworks might be difficult to evaluate and its worth or price is largely subjective. Sales are then dependent on the extent to which the art engages the viewer/buyer.

As, art of any kind from emerging artists involves a certain amount of risk from a financial investment angle, it is not surprising that there are more takers for experimental art by established artists than by emerging ones. Only when the market matures further, there might be a shift in perception leading to greater acceptance and appreciation for newer forms of art.

(Published in Financial Times)

It is art season again

(By Nalini S Malaviya)

After a brief hiatus, there is a lot of activity related to art happening in cities across the country. Art collectors and buyers have plenty to look forward to in the coming season, as there are a number of exhibitions, talks and fairs which will be taking place over the next few months.

A few days ago in New Delhi, an unusual project titled ‘Conscious-sub-conscious’ organized by Gallery Espace, began, which involves letting artist Manjunath Kamath paint the gallery walls. Over a period of seven days, Kamath will draw on the walls of the gallery, converting it into a temporary studio and visitors can walk in to view what he has created and interact with the artist. However after a week’s viewing of the completed work’s display, the gallery will whitewash its walls! Another exhibition ‘Indian (Sub)way’at Vadehra Art Gallery in the capital features a group of artists in a show that has been curated by Yashodhara Dalmia.

In Mumbai, ‘Rivers of Blood’ by Paula Sengupta is going on at Gallery Chemould Prescott and The Guild Art Gallery is presenting a unique initiative involving artists and public titled 'I think therefore graffiti'. In Bangalore, 103°C Yellow Fever and other works, an art show by Zakkir Hussain just ended at a city gallery, while a show dedicated to drawings curated by Yusuf Arakkal is going on at Galerie Sara Arakkal. Birendra Pani’s solo exhibition is upcoming at Gallery Sumukha in Bangalore, while a group show curated by the London based curator and writer Shaheen Merali is going on in Chennai.

India Art Summit has come out with a list of participating galleries – 84 from 21 countries at the fair scheduled to take place in January, next year. The scale of the event is much larger than last year and promises to be better than before.

These are just some of the exhibitions, which are either ongoing or scheduled to take place shortly. Apart from these, there are many other events and shows that art connoisseurs can look forward to the next few months. The wide spectrum of art offers a perfect opportunity to view some good quality and interesting art, network with artists and others, and to get familiar with various trends as well.

(Published in Financial Times)

Buying art on installments

(By Nalini S Malaviya)

Prices of art are often such that one would require having fairly deep pockets to be able to afford a good, or rather a work by an established artist. A long time ago when people bought art for simpler reasons that stemmed from a passion for art and from a desire to help out artists whom they knew personally, it was common to have informal arrangements with regards to paying the artist or gallery. This could often involve payment in installments over a certain period of time. This not only helped the buyer in acquiring works, which they felt strongly about but also the artist in ensuring that his works kept on moving.

Although, the economics of art has changed form completely from those days, even today there are galleries who are willing to let you own a work of art, even if you cannot make an outright payment. This trend opens up possibilities for the buyer to be able to make the payment in smaller denominations and not feel the pinch to that extent. Today, general financial conditions have improved substantially, yet there is a certain reluctance to invest heavily in art. In such a situation, the option of paying in installments not only helps the buyer but also in ensuring that sales take place.

Incidentally, the younger generation, which is quite used to the concept of owning things first and paying later, is bound to find the scheme attractive. Normally, one does not associate art with such an ‘installment’ concept, but in fact, it has its plus points. A lump sum payment can be a little scary for the first time buyer who may feel more confident in paying in smaller portions over the next few months. Such transactions are usually reserved for trusted clients or when the gallery feels that the buyer is genuinely interested in acquiring the work. Still, these dealings are rarely publicized and usually take place on an informal level.

Published in Financial Times

Online resources a boon for art connoisseurs

(By Nalini S Malaviya)

Today’s pace of life has caused many changes to be incorporated in our daily lives - the way we shop, what we eat and how we spend our time have all undergone major transformations. Easy access to information has also resulted in numerous changes that impact the way we look for information, retrieve and process it. In the field of art as well, this ease of access to online resources has had a major impact that has been benefiting the art community as a whole. It gives the art aficionado the opportunity to know about arts trends, events that are happening everywhere - right from London to New Delhi, to view images and read online publications.

The online facility has contributed tremendously in creating a greater awareness about art. People who are not as clued in about art have the opportunity to brush up on art, as well as compare prices of artworks.

For art connoisseurs, an online community is an excellent way to keep in touch with others who share a similar passion and offers them the opportunity to share information, and also to verify facts whenever required. Most people who once become passionate about art like to keep themselves in the know about major art events that take place across the world, for instance international art fairs, significant auctions and important gallery shows. Now that art catalogs are also available on the Internet, most people find it very convenient to refer to them. A majority of auction houses also provide access to their online catalogs on registration and this offers the potential buyer an excellent opportunity to preview the works before hand. Gallery newsletters and updates are also available through e-mailers and ensure that clients are kept informed of all upcoming events.

On the downside, you may end up spending too much time on the Internet, but it does make it easy to keep yourself updated on art.

(Published in Financial Times)

A look at the art market – reports suggest that confidence is slowly returning

(By Nalini S Malaviya)

Even as speculations regarding the art market continue to make the rounds, a recent report on the Indian art market suggests that there is an overall increase in the confidence indicator compared to last year. It is noticed that the positive sentiment is on the rise. It has also been observed that the gap in confidence between the modern Indian and the contemporary Indian art market is widening, with the former measuring 51% higher than that for the contemporary Indian art market. Again, this may not be surprising as the modern artists have an established and a proven track record compared to the contemporaries.

Most readers will agree to this trend and may have arrived at a similar analysis themselves, based on the existing situation, and by also taking into account the fact that the economic situation is on the revival. Most collectors and investors who have invested in the art market will also be relieved to see the first positive signs, which are based on actual facts and figures.

The overall drop in confidence last year that was projected by various market reports based on statistical data and analysis resulted in a further slowdown of the art market where sales were negligible. In fact, in this phase not only were the sales affected, but also the number of art activities such as exhibitions and other events had gone down considerably. Now that the sentiment seems to be turning towards a positive note, it is also possible that some of the speculators may decide to make a comeback in the art market, once again. Although, this is likely in any market which is poised to grow over the years and one may have to wait and see how it eventually affects the overall art market in the long term.

Although, these are early signs of recovery and will help in creating a buoyant mood, it would be wise to adopt a slightly cautious approach in the interim, before investing huge amounts in the art market.

(Published in Financial Times)

Traveling shows are a good idea

(By Nalini S Malaviya)

Nowadays, it is common to see art shows traveling from one city to another. As more and more art galleries come up in different cities across the country, collaborative efforts are on the rise. This, in fact is a wonderful way to increase exposure to art - it benefits not only the artist but also the viewer and of course, the gallery.

Multi-city exhibitions are now the trend rather than an exception. Cities such as New Delhi, Mumbai, Kolkata, Bangalore and Chennai have become part of the art circuit. It is especially useful when bigger artists exhibit their works in metros and then these shows travel to smaller ones. In fact, many art shows are traveling not only within India but are also going abroad to places such as Singapore, New York, London and Hong Kong. For instance, a retrospective of artist Surya Prakash began in Hyderabad and has already traversed Mumbai and New Delhi and will soon arrive in Bangalore, before moving on to Munich, London and New York. Similarly, to mark the 75th birthday of Sakti Burman, a show of Limited Edition Serigraphs will be showcased in Mumbai, Bangalore, Chennai, New Delhi and Kolkata.

The entire process also proves beneficial to the prospective buyer or investor, for instance, people who are particular about physically seeing an artwork before making the actual purchase now have easier access to the art. And, although the logistics of organizing art exhibitions that have to be physically moved from one place to another can be challenging and collaborations with other galleries may not be simple, overall these efforts are good for the art market. On the other hand, most of the bigger galleries now have their brunches in different cities - both within the country and abroad, and for them it makes a lot of sense to carry their exhibitions from one place to another. As a buyer or investor one can subscribe to newsletters or information on forthcoming shows, to keep themselves updated about exhibitions that they are interested in and which will be available in their city in future.

(Published in Financial Times)

The fine art of collecting

(By Nalini S Malaviya)

Now, that once more there is an interest in art, there are people who are looking at art either as a financial investment or as a collectible. To begin an art collection it is important to identify the motives behind it. One of the main reasons why people collect art is that they are passionate about it.

There are collectors who buy representative art from various periods or they focus on a specific school, style of painting, era or artist. Again, it is important to be clear whether the collection is going to be a private one or if it could be put on public display at a later date. It is also essential to realize that an art collection, unlike one comprising of smaller collectibles needs a lot of space, and special care in terms of lighting and maintenance.

Once you have identified the kind of collection that you are looking at building, you can begin by making a list of artists or works that you wish to acquire. In fact, there are some people who might begin collecting in a small way and then get so passionate about it that they decide to convert it into a more organized and larger collection. There are some people who prefer to collect only modern art or contemporary works, or old prints or only new media works. Sometimes, the choice of the collector is governed by considerations such as budget, available space, and time required to dedicate to such an activity.

Whatever the reason behind collecting, the process of buying art can be an exciting and rewarding one. However, there will be times, when one is forced to overlook personal tastes in favor of more intelligent choices, which would benefit the entire collection as a whole.

When one is collecting art, irrespective of the initial investment, the overall value of the collection is bound to go up with time. Therefore, it is important that you do the necessary research and take the time to build one that will be significant in terms of historical content and also its financial worth.

(Published in Financial Times)

Understanding art prices

(By Nalini S Malaviya)

Now that the art market is beginning to look up, there is a lot of interest in understanding the intricacies of the market. The pricing of artworks has been a component that often requires a greater understanding of the market dynamics in order to analyze it. And, even then it may not appear entirely rational, as it is not completely deterministic or quantifiable.
Many people fail to comprehend the logic behind art prices and their upward movement due to its multivariate nature, there are a certain amount of elements that influence it. Also, it is important realize that there is a difference between the commercial price of an artwork and its value. The price of an artwork is determined by physical attributes such as market conditions whereas the value is its perceived worth or a subjective opinion of the viewer.
Typically, the price of an artwork depends upon the medium and size of the work, previous price points, its rarity and the artist. Art prices in the primary market are driven essentially by the artist and the gallery, whereas prices in the secondary market are often driven by demand. For instance, in an auction there is a reserve price which is estimated for a given piece of work prior to the auction, and its subsequent sale price could be much higher, sometimes in multiples of the reserve price. The sale price is driven up by the demand and may be a result of competitive bidding.
It has also become common to estimate prices of an artwork based on per-square-inch / foot or centimeter. And, some auction houses tend to follow this system of computation as a basis. However, there are no standard formulae to evaluate the price or value of an artwork, and hence the discrepancies that are seen in the market.
As a buyer it would be wise to crosscheck comparative prices before making a decision, but at the end of the day, if there is a particular piece of art that you wish to own, be prepared to pay for it.
(Published in Financial Times)