BAA 6 Month Report

Beautiful Asset Advisors, creators of the Mei Moses family of art indexes has released their 6 month Insights on Art Market Financial Performance report.  As noted in the report, some of the interesting aspects of the financial returns are the traditional Chinese Works of Art index being down, with a negative return, the first time since 2007.  Strengthening were the American and British categories.  All combined, art has under-performed for since the end of 2011 when compared to the financial indexes.

Click HERE to visit the BAA site (click on recent  press releases, and 2012 Mid Year report) to donwload the press release of the art market analysis.  The full report with much more detail is available to BAA premium subscribers (discounted rates for appraisers)

BAA reports on the first half of 2012

Our world wide data collection and reporting efforts based on over 110 Sotheby’s and Christie’s world wide auctions that occurred in the first half of 2012 produced over 1700 repeat sale pairs.  These pairs allowed us to ©2012 BEAUTIFUL ASSET ADVISORS® LLC  SOURCE WWW.ARTASANASSET.COM create the Mei Moses family of art indexes for the first half of 2012 which produced the following results over year end 2011.

WORLD ALL ART INDEX DOWN 0.02%

WORLD TRADITIONAL CHINESE WORKS OF ART INDEX DOWN 3.9%

WORLD IMPRESSIONIST AND MODERN INDEX UP 3.5%

WORLD POST WAR AND CONTEMPROARY INDEX UP 2.7%

WORLD OLD MASTER & 19TH CENTURY INDEX UP 5.4%

NEW YORK BASED LATIN AMERICAN INDEX UP 2.0%

NEW YORK BASED AMERICAN ART INDEX UP 27.5%

LONDON BASED BRITISH WORKS OF ART INDEX UP 12.8%

 
Clearly only two of these art collecting categories outperformed the strong year to date returns of the S&P 500 TR index.  It is interesting to note that the main growth this year has been in the British and American painting categories which had been underperforming the art market over the last decade. It is also interesting to note that traditional Chinese works of art has given up its leading role and actually had a negative return for the first time since 2007.  In addition for the third time in the last 10 years the impressionist and modern index outperformed the post war index.

While the index comparisons show a weakening position of art versus equities the returns of the individual items that make up the indexes tell a different story.  Knowing the purchase and sale price for each of the 1700 plus objects added to our database for the first half of 2012 we can compute the compound annual return (CAR) for each object and then compute the average of those individual object returns.  The result is an average CAR of 7.3%.  The average CAR of equal sums invested in the S&P 500 TR index for the same holding period as the art objects is 6.2%.  This is a positive result for the punchers of the art since they achieved relatively similar returns and obtained the enjoyment from viewing the art for free.

Source: Art as an Asset/Beautiful Asset Advisors/Mei Moses Indexes