Investment Art: A Beginner's Guide

Forget your shares portfolio - the recession-dodging art market is increasingly proving to be the most profitable place for high-stakes investment

Oscar Wilde may have been mistaken when he claimed “all art is quite useless”. A new use for art has been emerging in recent years, and it may be the most pragmatic of all – as a solid investment. In a time when stock markets are sinking, debts are rising and the looming threat of double-dip recession cannot be entirely eliminated, the art market still sporadically dazzles with record-breaking profits. The unique economic buoyancy of art has long caught the eye of not just aesthetes, but also discerning investors.

Art now falls under the category of the "SWAG" asset. The term, coined by analyst Joe Roseman of Investment Week denotes "alternate investments" which manage to defy economic gravity – namely silver, wine, art and gold.

As well as being decidedly sexier than the FTSE 100, the trend of investing in luxury assets makes a lot of economic common sense. SWAGs often outperform other equities in times of economic downturn for several logical reasons. Firstly, they benefit from the uniquely profitable principle of "scarcity economics" (their value is related to their rarity). Secondly, in an unsteady market, people are drawn to stability, and all the SWAG assets are durable – they have a historical precedence of desirability and can be bought and stored almost indefinitely. Lastly, as their returns are not related to the patterns of the stock market, they add a sensible diversity to any portfolio, the literal asset equivalent of not keeping all your eggs in one basket.

So, we’ve all been there - you’ve got a few spare million in the savings account and you can’t decide whether to invest in the Damien Hirst or the Château Lafite. Luckily, help is at hand. The art market’s unique ability to maintain a bubble of prosperity amidst a global recession has given rise to a new type of business – the art investment advisor.

Businesses of this sort were virtually unheard of a decade ago, and yet the demand  for art purely as an investment has seen a proliferation in recent years. As well as increasing numbers of private banks offering advisory services to their clients, specialist companies such as Fine Art Wealth Management and The Art Investor exist to assist buyers on making choices for bespoke portfolios which can maximise returns. Perhaps most significant in this field, however, is The Fine Art Fund. Set up just over a decade ago by Philip Hoffman, this was the first business of its type to invest in art as an asset. Currently, they manage more than $150m of assets and achieved a net annual return of 6.34 per cent over the past eight years.

Hoffman recently told the Sunday Times, “In the old days people invested in bonds, stocks and cash, and now they’re investing in ten different subject headings and art is just one of them ... People don’t look at their gold bars and, in some cases, they treat art in the same way.”

The rise of these businesses is necessary because the unregulated nature of the art market means that it still straddles an awkward line between solid economic sense and a frantic, wild gamble. On one hand, there are plenty of promising statistics: in 2011, the Financial Times reported that the art market made an 11 per cent return to its investors, a frantic outstripping of stock market return. This year, sales have been promising, with impressive prices achieved at Art Basel in June, and there is a wealth of evidence that the top end of the market has been immune to the turbulence underneath it. In fact, over half of the 20 most expensive auction sales of all time have been completed since 2008, indicating an economic buoyancy which overcomes even the recession.

So far, so lucrative. Yet, the mechanics of the art economy are governed by strange, volatile forces which means that it is never a safe bet. Charles Saatchi himself noted “Art is no investment unless you get very, very lucky” in his 2009 book My Name is Charles Saatchi and I am an Artaholic. In many ways the art market is an economist’s worst nightmare. It is wholly speculative and subjective, and therefore constitutionally unpredictable. The valuation of contemporary art, in particular, is based on a collection of changeable and changing opinions. It is constantly affected by external circumstances, and trends are capable of crashing out of fashion just as swiftly as they crashed it. Additionally, it is fundamentally impossible to confirm the value of the market as a whole. Private sales comprise approximately 75 per cent of the total market, and these are almost always undisclosed. “The art market is the most illiquid, opaque market in the world,” explained Jeff Rabin, quoted in The Art Newspaper. Given this, manoeuvring within it is always going to be a guessing game.

Other industries have, too, sprung up in reaction to the demand of fine-art investment, notably the specialist storage port. Investment art is, emphatically, not bought to be hung on the wall. Instead, collectors are increasingly storing their assets in state-of-the-art warehouses. Christies are currently expanding their "Fine Art Storage Service" due to increased demand, and new ports are due to open in Singapore and Luxenbourg, adding to existing onces in Geneva. These large-scale warehouses offer highly regulated storage controls with humidity and light protection as well as extensive on-site security. They also have a notably appeal to the money-minded collector in that they allow the temporary postponement of VAT and customs duty payments.

The implications of this are vast. Not only with regards to the valuation of art, but with an entire overhaul of its purpose. Art bought as an asset and stored, indefinitely in a warehouse, far from the damaging light of day denotes a new mode of art ownership – one where the object d’art is reduced to a purely monetary transaction.

“It’s a depressing thought,” comments Connie Viney, a London-based artist who regularly exhibits at The Vyner Street Gallery, “Just recently there was the news that Sotheby’s have once again broken their auction record by selling a Rothko for £47.3m. By all accounts, it seems that that price will just increase once again next time it’s sold. With sums like that, how can people think of art becoming anything but a get-rich-quick scheme?”

Is this the real status of art in today's world? Elite, out-priced, stored out of site and endlessly circulated in a micro-economy closed off to all but the super-wealthy? "Art for art’s sake" is a 19th century concept. "Art for the people", too, is becoming swiftly outdated. The motto for our times, it seems, is "Art for the 1 per cent".

Auctioneers place bids during the Damien Hirst's Beautiful Inside My Head Forever, at Sotheby's in 2008. (Photo by Daniel Berehulak/Getty Images)

Kamila Kocialkowska is a freelance journalist based in London.



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Poldark is the latest show to throw in a lazy, irresponsible rape scene

It’s particularly dangerous to present a scene like this as consensual, as the writers insist it is.

So Poldark has become the latest show to throw in a lazy, irresponsible rape scene to spice things up. We’ve sat through them in outrage-courting Game of Thrones, in cosy Sunday night drama Downton Abbey, and even at the opera. Now, they’ve come to BBC period adaptations, too.

This is how the scene plays out (a detailed description of the events leading up to the rape follow):

Poldark (Aidan Tuner) turns up at his friend Elizabeth’s bedroom door in the middle of the night, in a rage. She suggests he come back tomorrow morning. He refuses. She suggests they relocate downstairs. He refuses. She suggests he should not be in her bedroom. He refuses to leave, and shuts the door behind him.

They argue about Elizabeth’s plan to marry an enemy of Poldark’s, a decision that disgusts him. She asks him to leave, again. “I’m sorry you feel like this, but I cannot help it,” she tells him. “Oh, you’ve never been able to help anything, have you?” he says, mockingly, adding, “well, perhaps you can’t help this either,” kissing her forcefully before she pushes him off her.

Poldark threatens her, approaching her again as he insists, “I oppose this marriage, Elizabeth. I’d be glad of your assurance that you will not go through with it.” She says again that she will be married. Poldark kisses her again against her will. She tells him she hates him. “You would not dare,” she pleads, looking at the bed. “I would, and so would you,” he says. He pushes her onto the bed. You can guess the rest.

Of course, this is a rape scene. Some say it isn’t – because Elizabeth shows signs of enjoying the sex, and she’s nice to Poldark the next morning, because she has (or has had) feelings for him. None of these things are relevant. Poldark verbally pressured and physically forced a woman who was refusing to have sex with him. That’s rape.

It’s particularly dangerous to present a scene like this as consensual, as the writers and cast insist it is. Andrew Graham, the son of Poldark novelist Winston Graham, who was a consultant on the BBC's current screen adaptation, said:

“There is no ‘shock rape’ storyline. The only way to judge what my father intended is to read the novels as a whole. Doing so it becomes clear, from earlier scenes as well as from Elizabeth's immediate reactions and later mixed emotions, that what finally happened was consensual sex born of long-term love and longing. It was, as Aidan Turner has put it, ‘unfinished business emotionally’.”

His opinion was supported by Poldark screenwriter Debbie Horsfield as well as Turner – who said the scene “seems consensual”.

This is not how consent works. Consent is not something you can assume based on “earlier scenes”. And it’s certainly not something you can retrospectively achieve based on the “immediate reactions” or “later mixed emotions” of someone you forced to have sex with you. That’s just you attempting to justify the fact that you raped someone.

The idea that Poldark knows Elizabeth so well that he knows what she truly wants (sex with me, the man of her dreams, duh!!) might seem romantic. But no love is so great that it imbues the lover with the ability to read minds. Implying that Poldark knew best peddles the dangerous myth that when women say no, they mean yes. Beliefs like this create rapists. The only way to know what someone wants is to ask them, and to listen to what they say. Elizabeth said no.

Adapting period material can be tricky – not least in its presentation of women, gender dynamics, and sex. The Poldark books are from the Fourties, and set in the eighteenth century. It’s a miserable state of affairs when the understanding of consent presented on primetime television, in 2016, is as dated.

Anna Leszkiewicz is a pop culture writer at the New Statesman.