In the Principality of Monaco the policy of supporting culture and creativity has been pursued both nationally and internationally. Art has always represented a point of interest in the Principality. For example the excellences of the contemporary art are honoured every year by the Fondation Prince Pierre.
Having world-wide more than 400 000 art collectors with an estimated art asset of 1.5 trillion USD a great demand was created for innovation around art. Since 2007 the art is identified as one of the best performing asset in long term, and thanks for the environmental changes wealth and asset managers started to see and consider art as a reliable tangible asset.
Dr. Mei Moses at the Stern Business School found art a fantastic investment with minimal correlation to other asset classes, and a long-term average return of 10.47% alike SP500 of 10.95%. In the past 10 years contemporary art has outperformed equities, bonds, property, hedge funds, private equity.
“The art market is finally in the shape as has never been before, but only those will benefit from it who are smart enough to see it in advance…” – Dodo Newman
Many countries have also noticed the value of art, therefore more and more Freeports are opening and helping the tax free art transactions in favour of diversified tangible asset portfolios. These Freeports are also considered as the most effective tools in art collection management.
Now-days art is considered as a new type of asset class for over 40% of the asset managers. Furthermore in 2012 almost 10% of the total net worth of the wealth were held in treasure assets. These facts have increased the confidence of the wealth and asset managers, and the economic uncertainty has increased the demand for art as a tangible investment.
- Selected and recommended artworks by Monaco Wealth Management
Meanwhile the main motivation to invest in art is still the emotional value, art market professionals are seeing the financial aspects too to invest and hold art assets. In the year of 2013 financial motivations became more and more important in the art market, which trigged the need of new services from the wealth and asset managers. It seems art became a great tool for them to win new businesses.
An impressive art collection strengthens your corporate image, improves client’s first impression of you and makes a bold statement of your company’s identity. Some of the motivations to invest in art are: Social status, Philanthropy, Taxation benefits, Diversification, Economic slowdown, Capital appreciation, Speculation, Extended Boom Period, Corporate Identity and Brand Management.
“The potential for growth in this area is awesome, as the economic evidence for contributing to culture and creating an inspiring work environment is mounting.” – Dodo Newman
Many banks are also offering art secured lending as their complementary services for HNWI, therefore they are becoming ideal partners for the collectors. Banks are offering a new experience to them by giving transparent pricing, quick decision timeframe and personal services.
Without any doubt art market is going through a great expansion where more and more money and players are involved in art. Art is becoming a niche of wealth and asset management services, which will continue its revolution in 2014-2015.
We also love art as an investment and an asset class but from a more human type of consideration. We believe art is all around us and the aesthetic inspiration is our footprint to the next generation. Art is not just a piece of canvas, a product but a passion and a message from our century. Something from us to our grandchildren. They are telling us their stories and sharing their emotions. Find the moment to understand them, allow them to communicate to you and to tell you their individual messages. When you find this harmony you can also combine the passion with the profitable long term investment.
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Other typical investment forms in the Principality of Monaco
- Venture-Capital & Business Angel investments
- Real-Estate investment
- Gold investment
- Diamond investment