Art is a long term Investment

(By Nalini S Malaviya)

In general, one should consider investing in art only after investing in traditional asset classes such as stocks, equity, real estate and gold. However, given the current scenario of the stock market, there are many prospective buyers with sufficient liquidity, who are looking at alternate options. Indian art has emerged as one of the safest investment instruments in recent times. However, investing in art is quite different from investing in other markets. While, it can be said that all investments require a fair amount of research, art in particular, requires greater research (as data is hard to come by) and an in-depth understanding of the art market dynamics. Another factor one must keep in mind is that art should be looked at as a fairly long-term investment, and to be aware that it is less liquid than conventional assets.

How can one spot a winner?

That is the million-dollar question most people ask when considering investing in art. There are many financial consultants who offer advice on equity and debt based funds, however, consultants specifically offering advice on art and its investment potential are very few. In such a case the onus of making the right decision falls on the investor. One can begin by studying the market, its trends and price graphs of well-known artists. It helps to define a budget that can be then sub-divided into parts according to the investment category – high risk, medium and safe.
Knowledge of art is an important consideration and it helps to read up on artists, their profiles, and in general keep abreast of updates on art related news and auctions. Once the generics are in place, one can look at details.

As a buyer a few questions that you need to ask yourself are,
What kind of work to buy – for instance, a painting, sculpture or a photograph?
Which artist/s to consider?
Where to buy from - a gallery, at an auction or a private dealer?
Will I be able to resell it? What are my options?
What are the various commissions and taxes that I need to know about?

Having the answers in place, it will be easier to begin shopping for art and in creating an investment portfolio.

(Published in Financial Times)

Art Buzz (Bangalore) Mini & Mandira Naidoo

Art Buzz (Mumbai) Chintan Upadhyay

Art Buzz (New Delhi) Photographic Works

The changing art scene

(Nalini S Malaviya)

Last week at the preview of one of the art shows, I was fortunate enough to meet Professor MGK Menon, a renowned Indian scientist. Prof Menon was part of Tata Institute of Fundamental Research (TIFR), Mumbai as a Director and currently he is an Advisor, Indian Space Research Organization. He was in the city on a holiday and one of the things that we talked about was the exorbitant price of artworks today. He incidentally helped build the art collection at TIFR during his tenure. Having bought KH Ara, Tyeb Mehta, MF Husain at prices that we cannot even dream of now, he felt how dramatically the art scene has changed over the years. It is so true when art lovers say that now people buy for investment and not because they have a passion for art!

It was interesting to see how most people comment on how the art scene in Bangalore has altered so much over the years. Well, the fact is that once the world sat up and took note of Indian art, the dynamics of the market changed forever. New Delhi is choc-a-block with galleries and artists, Mumbai, of course is the nerve centre, Kolkata is somewhat lagging behind, but Bangalore is one city that has seen some furious growth.

The art scene here is much more vibrant now than say five years ago, lots of shows are happening, many foreign artists are also exhibiting here, but on the flip side many local artists who are incredibly talented and are doing very well outside the city, do not show their works here. Which is such a pity!
And, sometimes one feels that at some level there is stagnation as well. When visiting exhibitions one hopes to see new and exciting works but one comes across familiar pieces. Well, if you look at the statistics, serious collectors and investors are opting to buy works by Indian artists whose works are more contemporary.

However, it is difficult for established artists to move to a different genre or medium - there is not only the comfort factor but often a genuine demand for those works. But, one wonders how long will this demand last? Shouldn’t the artists look at reinventing themselves? Galleries and curators should also take it upon themselves to encourage artists to experiment. Younger artists who have the talent and skill should be promoted. When that happens the art scene in Bangalore will truly be more alive and vibrant.