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The Worth of Art: Financial Tools for the Art Markets
The market for art can be as eye-catching as artworks themselves. Works by artists from da Vinci and Rembrandt to Picasso and Modigliani have sold for hundreds of millions of dollars. The world’s ultrawealthy increasingly treat art as part of their portfolios. Since artworks are often valuable assets, how should financial professionals analyze them?
Arturo Cifuentes and Ventura Charlin provide an expert guide to the methods, risks, and rewards of investing in art. They detail how to apply the financial and statistical tools and techniques used to evaluate more traditional investments such as stocks, bonds, and real estate to art markets.
The Worth of Financial Tools for the Art Markets shows readers how to use empirical evidence to answer questions such How do the returns on Basquiat compare to the S&P 500? Are Monet’s portraits as valuable as his landscapes? Do red paintings fetch higher prices than blue ones, and does the color palette matter equally to the sales of abstract Rothkos and figurative Hockneys? How much should be loaned to a borrower who is pledging one of Joan Mitchell’s late abstract paintings as collateral? Would the risk-return profile of a conventional portfolio benefit from exposure to Warhol?
Rigorous and readable, this book also demonstrates how quantitative analysis can deepen aesthetic appreciation of art.
Arturo Cifuentes and Ventura Charlin provide an expert guide to the methods, risks, and rewards of investing in art. They detail how to apply the financial and statistical tools and techniques used to evaluate more traditional investments such as stocks, bonds, and real estate to art markets.
The Worth of Financial Tools for the Art Markets shows readers how to use empirical evidence to answer questions such How do the returns on Basquiat compare to the S&P 500? Are Monet’s portraits as valuable as his landscapes? Do red paintings fetch higher prices than blue ones, and does the color palette matter equally to the sales of abstract Rothkos and figurative Hockneys? How much should be loaned to a borrower who is pledging one of Joan Mitchell’s late abstract paintings as collateral? Would the risk-return profile of a conventional portfolio benefit from exposure to Warhol?
Rigorous and readable, this book also demonstrates how quantitative analysis can deepen aesthetic appreciation of art.
272 pages, Hardcover
Published September 5, 2023
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Displaying 1 - 2 of 2 reviews
September 12, 2023
This book’s audience is, of course, those involved in the art market such as auction houses, appraisers, and lenders. But the authors strove for a broader appeal and say one does not need a formal mathematical background to follow their methods, just an entry level grasp of financial concepts and statistics. They include an appendix with friendly explanations for scary words such as linear regression, Monte Carlo simulation, and statistical significance. What is most important, in their view, is a love of art.
The global art market hit $64 billion in 2019, so a better framework for valuing art besides “The Eye”—the gatekeeper behind the curtain—makes sense. The aim of this book is to demonstrate how the scientific approach, or financial techniques, can be applied to art investing.
One myth dispelled is that there is no such thing as an art market. To put this notion in terms we understand, the authors compare it with the term “emerging markets.” The difference in outcome varies by artist or country. Neither are pools. Beyond that, investment outcomes vary by individual works, even if they are part of a series. Jean-Michel Basquiat’s sales are used to demonstrate this concept, which is contrary to purchasing corporate stock where each share in a class has the same value.
The authors explain the challenges of investing in art. It is a game for high-net-worth folks, for one. It is not a liquid market and, unlike buying a mutual fund or ETF, the risk is not shared among investors. Questions of authenticity, provenance, and condition must be resolved. To make matters worse, the market is secretive and opaque and there isn’t a central, professionally maintained registry.
As an art lover, it is interesting to see what components influence a work of art’s value and how financial tools are applied to them. Art punches above its weight the authors say, so it is not surprising that area matters and is compared to real estate’s classic price-per-foot. Indeed, it is the most influential variable. Larger canvases are more desirable as in real estate, but both have a threshold. Motif or theme is also correlated to price. Some familiar items included in tables are canvas area, orientation, motif, auction house, whether it is a day or evening sale, and elements in the painting such as presence of and number of people.
Readers who love art should not be shy of this book. There are tables that might need skimming, but the writing and the explanations are approachable.
Thank you to Columbia University Press and NetGalley for providing this eARC.
The global art market hit $64 billion in 2019, so a better framework for valuing art besides “The Eye”—the gatekeeper behind the curtain—makes sense. The aim of this book is to demonstrate how the scientific approach, or financial techniques, can be applied to art investing.
One myth dispelled is that there is no such thing as an art market. To put this notion in terms we understand, the authors compare it with the term “emerging markets.” The difference in outcome varies by artist or country. Neither are pools. Beyond that, investment outcomes vary by individual works, even if they are part of a series. Jean-Michel Basquiat’s sales are used to demonstrate this concept, which is contrary to purchasing corporate stock where each share in a class has the same value.
The authors explain the challenges of investing in art. It is a game for high-net-worth folks, for one. It is not a liquid market and, unlike buying a mutual fund or ETF, the risk is not shared among investors. Questions of authenticity, provenance, and condition must be resolved. To make matters worse, the market is secretive and opaque and there isn’t a central, professionally maintained registry.
As an art lover, it is interesting to see what components influence a work of art’s value and how financial tools are applied to them. Art punches above its weight the authors say, so it is not surprising that area matters and is compared to real estate’s classic price-per-foot. Indeed, it is the most influential variable. Larger canvases are more desirable as in real estate, but both have a threshold. Motif or theme is also correlated to price. Some familiar items included in tables are canvas area, orientation, motif, auction house, whether it is a day or evening sale, and elements in the painting such as presence of and number of people.
Readers who love art should not be shy of this book. There are tables that might need skimming, but the writing and the explanations are approachable.
Thank you to Columbia University Press and NetGalley for providing this eARC.
2023
October 13, 2025Non-fiction November TBR
📱 Thank you to NetGalley and Columbia Business School Publishing
📱 Thank you to NetGalley and Columbia Business School Publishing
Displaying 1 - 2 of 2 reviews