Mei Moses/Beautiful Asset Advisors have just released their anaylsis from the recent London post war and contemporary art sales. The results show, again like the previous London impressionist and modern sales, that the top of the market evening sales returns out perfomr those from the day sales. Showing that trophy purchases continue to drive the market.
The evening sales with 21 lots with prior auction results returned 12%, while the day sales with 42 prior auction sales returned only 7.3%. The average return was 8.9% and that beat the S&P return of 7.2%.
Beautiful Assest Advisors/Mei Moses report
Source: Beautiful Asset Advisors/Mei Moses Art IndexesA TALE OF TWO MARKETS FROM A TRUE RETURNS PERSPECTIVE: POST WAR AND CONTEMPORARY (PWC) NIGHT SALES OUTPERFORM WHILE DAY SALES UNDERPERFORM AT MAJOR JUNE 2013 LONDON SALES
THE LONDON AUCTION ART MARKET RESPONDED TO CONTINUED GLOBAL ECONOMIC AND STOCK MARKET VOLATILITY WITH BIPOLAR RESULTS. THE EVENING SALES PRODUCED ABOVE AVERAGE RESULTS WITH AVERAGE COMPOUND ANNUAL RETURNS (CAR) OF 12% FOR THE 21 LOTS WITH PRIOR AUCTION PURCHASE PRICE DATA. IN COMPARISON THE 42 PWC DAY LOTS WITH PURCHASE PRICE DATA PRODUCED A BELOW AVERAGE CAR OF 7.3%.
HOWEVER THE PERFORMANCE OF THE ART RELATIVE TO EQUITIES DID NOT DEPENDED ON WHETHER THEY WERE SOLD IN THE DAY OR NIGHT SESSION. THESE RETURNS ASSUME THE EQUITY RETURNS WERE BASED ON INVESTING SIMILAR SUMS IN THE S&P 500 TOTAL RETURN INDEX FOR THE SAME HOLDING PERIOD AS EACH ART OBJECT. ©
SUMMARY
There were four day and evening PWC sales held in London in June. This is the high point of the late spring auction season in London at the two auction houses we cover in our analysis; Sotheby’s and Christie’s. The sales have been reported in the press as having results for total sales or percent sold that ranged from slightly above to slightly below average. We found 63 lots that sold that had prior auction prices that we could find which allow us to compute a true return for each of these objects. From a financial returns perspective of the holders of the art that sold the results were slightly below historical return results for this collecting category. The average of the compound annual returns (CAR) of all of the 63 lots that sold was 8.9% which is about 15% lower than our historical values for this collecting category. However these returns were above the returns that would have been achieved if the value of the art purchases had been invested instead in the S&P 500 Total Return index (where dividends are reinvested tax free) for the identical holding periods as the art. The average CAR for the S&P investments would have been 7.2%.
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