Investing in art without having the slightest work is possible. Specialized funds have emerged like that of Société Générale. Lighting.
An investment fund dedicated to art? The initiative of Société Générale Asset Management announced in early 2008 could surprise. However, “it was British Rail, a British pension fund which created, in 1973, the first investment fund in art”, explains Fabien Bouglé, consultant in artistic heritage management at Saint Eloy Art Consulting. In France, the BNP also launched BNP Art in 1981. “In both cases, the works were sold in difficult market conditions” continues the specialist. But reappeared for a few years, the concept could now find the way to success.
A dynamic art market
Proof of this is, the Fine Art Fund Established in 2004 by Philipp Hoffman, former financial director of the Maison d’Enuce Christie’s, has reached a profitability rate of 36 % since its inception. “The creation of the fund Sgam ai art fund From Société Générale therefore intervenes in an interesting context on the art market, observes Fabien Bouglé. Especially since the process is innovative “. Indeed, the fund is based on acquisitions in partnership with art merchants, but also on direct purchases from private collections or artist workshops, and on advance operations on sale with auction houses. All directed by managers from Société Générale but also by art historians and confirmed collectors. “Thanks to this strategy, we count on an annual return of 15 to 20 % in a bull market, and from 7 to 12 % on a lower market”, Specifies Olivier Maman, manager of the Sgam Ai Art Fund fund.
Beyond the promises displayed by this new fund, the general context of the art market seems favorable. On the one hand, the luxury sector has experienced a strong dynamism in recent years, drawn in particular by growth in emerging countries and the good economic situation in developed countries. “There subprime crisis Little impact the art market, explains Olivier Maman. The latter is supported by the explosion of big fortunes in recent years. “On the other hand, we are witnessing the emergence of contemporary and modern Russian and Asian art. The world of art sees more and more investors from Asia, the Middle East, East and South America, which contributes to general dynamism.
Not within everyone’s reach
Be careful however, if these investments may be suitable for investors looking for diversification, they are mainly intended for wealthy customers. For the Société Générale fund, for example, the starting bet is set at 125,000 euros. A budget that is not within the reach of all budgets!
“And the field of art remains random and therefore risky, recalls Fabien Bouglé. Whatever happens, to increase his chances of added value, it is better to keep the works that we hold as long as possible, and beyond 10 years”. Finally, to fully appreciate the value of the works, it is advisable to closely follow the developments in the art market, even, if you lack time or expertise, to turn to an expert in artistic wealth management.