New Traditional Chinese Works of Art Index at Mei Moses

Beautiful Asset Advisors has just announced the creation and publishing of the new Mei Moses Traditional Chinese Works of Art Index (TCWA).

Like other Mei Moses art indexes, the TCWA is based upon repeat  and market to market sales.  According to the new report the TCWA index has over 1,400 repeat sales and are adding at a rate of 150 pairs per year.

As we all know from the various tracking sources, many Chinese fine and decorative arts sector are very strong, and the new Mei Moses index will help in documenting these important and fast moving market trends within an appraisal analysis. These types of reports and indexes are very important to the appraiser, especially when markets are not balanced and there are rapid increases or decreases.

The report concludes that since 1985 the TCWA has had a compound annual return of 8.4%, and 14% since the end of 1999 (see image). If you look at the graph within the report, it is easy to see the large increase over the past 2.5 years.  The TCWA far outperforms the total return of the Standards and Poors 500 over the same period.

A summary report is available to all viewers, while the more advanced complete report is available only to subscribers.  If you are a subscriber to Beautiful Asset Advisors/Art as an Asset and the Mei Moses Art Indexes, I recommend you read the full TCWA report, and if you are not, I still recommend you visit the site and read the summary which is very informative.

The initial TCWA report states

We have developed such a database for the traditional Chinese works of art (TCWA) market which has over 1,400 repeat sale auction pairs to which approximately an additional 150 pairs are added each year.  This approach is identical to what we have employed for all the other art markets we cover.  We use a similar methodology and data collection philosophy to create our art indexes as that used to compile the Standard & Poors Case Shiller residential real estate index.

Traditional Chinese works of art have been collected on a world wide basis for hundreds of years and there has been an active auction market in New York, London and Hong Kong for over 50 years.  This collecting category is made up of ceramics, jades, painted screens and scrolls and antique furniture.  Objects usually have a date of creation ranging from the mid 1950’s back to the first millennium. Original purchase prices normally range from a few thousand to many millions of dollars.  All the purchase and sale prices in our database have been converted to U.S. dollars.

Our 1400 repeat sale pairs gives us sufficient data to allow for the creation of an index that starts at year end 1985.  Using a start date any earlier than this produces an index that does not have sufficient explanatory power to meet our requirements.  We compare our index to other financial indexes to determine relative performance.  We use the total return indexes (where dividends are reinvested tax free) of the S&P 500 for the U.S. and in China the Hang Sang index from Hong Kong and the SSE index from Shanghais.  We have been able to obtain data for the Hang Sang index from year end 1986 and the SSE index from year end 1999.

To visit the site and read the report, click HERE and then when the BAA site opens, click on the vertical "Learn More" navigation bar for China.

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