With the rapid development of contemporary art market, more and more investors begin to pay attention to art investment. Blue chip art created by influential artists is often regarded as a relatively safe investment choice. This article will analyze the basics of investing in blue chip art and provide suggestions on building an art portfolio with blue chip artworks.
blue chip artists are backed by art institutions and have stable value
Blue chip art is created by well-established artists who have gained art world recognition. Their works are collected and exhibited by major art museums and sold at top auction houses. These artists often have a large body of excellent works with consistent styles and enjoy lasting market popularity. Investing in blue chip artists can provide downside protection in market turndowns. Famous Western blue chip artists include Andy Warhol, Jeff Koons, Jean-Michel Basquiat. Leading Chinese blue chip artists are Zhang Xiaogang, Zeng Fanzhi, Liu Ye, etc. Their works have set auction records and maintained stable value growth.
blue chip art provides portfolio diversification and inflation hedge
Including blue chip art in an investment portfolio can enhance diversification and reduce overall risk. Fine art tends to have low correlation with stocks and bonds, making it a good portfolio diversifier. In times of inflation, blue chip art can potentially preserve or increase value. For instance, iconic Warhol and Basquiat paintings have appreciated substantially faster than inflation over the past decades. However, appraisal and transaction costs need to be considered for art investment.
focus on limited-supply artworks in peak periods
When building an blue chip art portfolio, investors should focus on artworks created in artists’ best periods that have limited supplies. Many established artists have different creative stages and their works created during peak artistic periods are most valuable. For example, Warhol’s iconic pop art silkscreen paintings from 1960s command the highest prices. Basquiat’s expressive Neo-Expressionist paintings done before 1988 are also blue chip works. In addition, print editions, rare early works and historically important artworks are good targets.
diversify across styles, categories and investment horizons
A diversified blue chip art portfolio should include different categories like painting, sculpture, print, photography across different artistic styles. Both emerging and late period blue chip art can be considered based on investment horizon. Ideally, aim for 20-40 pieces of varied blue chip artworks from a few leading artists bought at reasonable valuations for balance.
Blue chip art created by established artists provides a relatively safe option for art investment. Carefully selecting iconic artworks produced in peak periods by major artists and diversifying across styles and time horizons allows investors to assemble a robust blue chip art portfolio.