By Esperanza Murcia
If we talk about investing, there is one word that will not come to mind: Art . But it's not only a safe investment, it also has a return of up to 10%, higher than the stock market. On the occasion of ARCO, the contemporary art fair currently taking place in Madrid, this is an excellent opportunity to talk about it. Because, spoiler alert, You don't need to be a millionaire to invest in this field or be the greatest expert. of this discipline.
To dismantle all these clichés, 'NoticiasTrabajo' has spoken with Elisa Hernando Calero , PhD in Business Economics and Art History. Two areas that might seem antagonistic but which she has managed to unite perfectly, as CEO of Global Art and RedCollector. “First, I studied economics and then art history, because my family told me I'd starve to death with art history, and that I had to pursue a career with opportunities. Well, I'm an entrepreneur and a businesswoman.”
How have you united both worlds? “Our specialty, above all, is advising people who want to buy or collect art from an investment perspective ,” while also managing several projects, including ARCO, for 14 years. “What I'm passionate about is dedicating myself to art and helping people buy and being able to resolve their doubts, because in the end, when you love art, it's a fairly complex sector.”
But, back to stereotypes. “There are two ideas. One is that you have to be rich, and two, that you have to know a lot. Our goal has always been to make the concept accessible to everyone.” Now, where to start? “ The important thing is that you like it . It's true that you might have to read, go to exhibitions, or visit fairs. And, in a way, you train your eye, you train your taste a little.”
And to do so, he recommends doing so with experts: "We can give you guidelines or guide you through your own tastes." The good thing, he confesses, is that art has that certain something that hooks you when you start, generating a curiosity to discover, to investigate, to learn more. Because yes, art is passion. "It's true, it's something so passionate that you want to know more every time, you go to an exhibition, you go to a museum... And that's what defines, to a certain extent, the training of your eye."
We already know that you don't have to be a millionaire to invest in art. How much do you need? " With €1,000 or €1,500, for example, you can buy a print by Antoni Tàpies or even Joan Miró. And you know that at any time, if you need it or get tired of it, you can sell it at auction, and we'll be able to help you sell it." “You really don’t need a very big budget.”
Although he does have one recommendation: "When you get into the art world, I do recommend having a defined annual time budget. For example, this year I'm going to dedicate 3,000 euros to myself. You can also allocate that money to travel, a car, or other things, and set aside money for different places throughout the year or as pieces emerge that might suit you."
An investment in which, as we mentioned, emotion also comes into play. Something very “nice” happens: “We see how people often shop as a family,” creating a bond and a way of relating, going to museums or galleries together, and “that’s also very cool.” Regarding this, there’s a fact that many people don’t know: you don’t have to pay anything to go to the museums. Auctions . They're free. So no one will charge you to go and watch.
Furthermore, it is interesting to do it, because it is quite an experience. "It is what is called the second-hand secondary market. "That is, the work has been sold at least once. Then the starting price is set by the owner of the work and everyone interested in it, like in movies. People bid, raise their hands, and the highest bidder wins. It's a market for works of art, not for artists," Elisa explains.
These, however, also have a "danger" that's also reflected in the films: you can get hooked! "At auction, the danger is that you get hooked. You're there and suddenly there are several people bidding, and you can end up paying a much higher price than it really is. That's a story, because they play on this part of you wanting to own it. As advisors, what we do is, if you like an artist, we look in galleries, at auctions, among collectors, nationally and internationally... In the end, the market is very large. What we do is identify that work, those artists with the right prices. Even if we bid at auction, we're going to bid for the price it's worth, that is, up to here, no more."
As the expert reveals, the second place to buy art would be the galleries , which anyone can also approach and enter. “It’s an open space, you don’t have to pay to enter. If you like something, you ask the price and go.” The good thing about these spaces is that they allow users to see different options and artists, Elisa explaining that they usually represent 10 or 15 at most: “They exhibit them, promote them, and sell them. This is what we call the first market .”
I want to invest in art: where do I start?
We've seen it. The first step is to do research, train your eye, and know what you like. But to do that, we can count on advice. "We have a year-long program that includes training through an online course that you take at your own pace. And then we do what would be group and individual sessions. There's support. Why? The idea is that they can go on their own afterward. Or that if they have questions, they can come to us at a specific time." The cost starts at 600 euros.
How do you know if the work is good?
Knowledge is power. But, broadly speaking, there are a series of guidelines that can guide us when determining the value of a work. “The CV is the most important reference,” although there are other factors: which galleries work with them, the technique, whether it is a unique edition, or the size (“there is a certain correlation in that larger works tend to be more expensive than smaller ones, but not always, there are exceptions”).
And does the artist's stage influence it? "It depends on the artists. In the end, what characterizes an artist is that they're innovative, creative, different, risk-taking, exploring a line, and not copying." You have to see when "that aesthetic click, in terms of being different," and "that ultimately comes from the eye, although we help with that."
Art, “a safe haven”
Gold is often described as a "safe" investment. But art can also be a stable alternative to volatile assets that are more dependent on the geopolitical and economic context. Can we speak of a specific return? Economic values can be consulted on the "Art Price" website: "They construct art appreciation indices based somewhat on historical data." "With established artists, we're talking about between 8 and 10% ," Elisa explains, confirming that in these cases it would be even more profitable than the stock market.
Thus, investing in art can be used as a safe haven to redeem in the event of a crisis or need, with the certainty that it will maintain a minimum value. Now, "not all artists or all works. As I was saying, a Miró etching by Tàpies, or similar pieces by already recognized artists, yes. And obviously, it's money you have there, which you're going to enjoy because you have it in your home. It has that aesthetic function of decoration, but also an economic value, and it can function perfectly as a safe haven."
Beware of speculation
Art, like other investments, is not immune to speculation. And a perfect example was seen with the NFT boom. “When we talk about the price of art or what variables influence it, one of the most important variables is the artist's resume: where they have exhibited, in which museums it is, what awards they have won, in which collections... And, suddenly, that price increase that there was in the NFTs were really more of a speculative movement than a validation from an artistic perspective . What has happened today? Well, it's almost disappeared. It's still an interesting technique because, in the end, artists always try to talk about society at the moment we're in. We're in a technological society, so, in the end, artists want to talk about what we're experiencing. It's normal to use technology and talk about digital, but, come on, those prices weren't real. With EO, you always have to be careful. And if you have doubts, that's what experts are for. You can take a lot of risks or get involved in complex and expensive investments and then lose money if you don't have some knowledge at that level.
This can also happen with artists who, as if out of nowhere, explode. “All these speculative movements can also occur in the art market. There's a movement in art called 'Wet Paint,' which involves artists under 40 and 45 years old, and there's suddenly been a boom, especially due to the entry of Asian collectors, who are buying a lot of art. So, there's a type of art language that's in high demand in Asia. In the end, they're drawing heavily on certain artists, coupled with the fact that the artist can produce a certain number of works a year, and a shortage arises. So, for example, what happened with Boafo, who was working with a very important gallery and his work was selling for around 100,000 euros, but, at auction, suddenly, his works were sold for a million. Those prices don't correspond to the profile or the resume of an artist of those characteristics. What happened? There are a lot of people bidding or interested in buying a work, and since there aren't any, people pay outrageous prices. This was about two or three years. Well, last year, the auctions returned to normal prices.”
Getting rid of the fear and shame of asking
The democratization of art. That's one of the goals. But why is it more difficult than other investments, such as cryptocurrencies? "The sector is still a bit complex, which is why it presents certain difficulties. Just as you can know the starting price at auctions, you have to ask prices at galleries. "It still seems like people are ashamed or afraid of this myth that you have to be very rich and very smart to buy art. Those are the myths I believe need to be broken, so we can facilitate access to art and make it truly seen as a truly beautiful way to invest."
In the end, we can't forget what we're talking about. Art "allows you to see the world differently, it makes you grow, it opens your mind." It's something "wonderful" in the society we live in. A different path that, at the same time, opens up other worlds from which you can learn all kinds of things. And that, beyond the money, is also a good investment.
