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What is Blue-Chip Art and Why Does it Always Over-Perform Other Assets?

Blue-chip art is well-known art that sells for the highest amounts at auction and appreciates in value over time. In the field of art investing, the word is used to distinguish work that is perceived as a relatively safe investment by a fine art appraiser or expert. Blue-chip art may be top of the list of possibilities to investigate if you’re considering investing in non-traditional asset types.

Fine art’s favorable investment features include its capacity to act as a source of value to hedge against inflation and currency depreciation. These characteristics have made it an increasingly appealing asset class for rich families, knowledgeable collectors, and a rising number of professional wealth managers over several decades.

Citi stated in a report based on data from Masterworks.io that since 1985, modern art has been the greatest choice for investors in the asset class, returning an estimated 7.5% per year. There has been a particular concentration on “blue chip” painters, whose works command the greatest prices and have the most collectors. This area of the art market has increased in value significantly since 2000 exceeding the expectation of many art enthusiasts and even someone as qualified as a fine art appraiser.

Risk-Adjusted Returns Within the Art Market

Any risk-adjusted return calculation seeks to determine the gain on an investment in relation to the portfolio’s level of volatility. The lower the risk, the lower the value of a particular return. From a financial standpoint, fine art, like the stock market, offers both risky and safe possibilities.

A fine art appraiser would say that it has never been easier to invest in blue-chip art than now. Furthermore, blue-chip art can help broaden your investments outside the stock market while providing reliable, competitive profits.

Blue-Chip Art vs Stocks

Contemporary artworks generated about $24 billion in 20 years, but art indexes like the ArtPrice Index can show how well they performed compared to the stock market during that time. ArtPrice analyzes the performance of the top artists over the last five years, with annual revisions to the top artists based on their relevance, using data from thousands of auction houses. According to their index, the top-ranked artists outperformed the S&P 500 by more than 250%.

Do you need an art appraisal? Are you looking to learn more about blue-chip art? Call AA Fine Arts to learn more. As members of The American Society of Appraisers, we are happy and qualified to help today.

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