Wrote an article for our personal finance section today. You might want to check it out:
Did you know that a good art collector could beat returns in the stock market in both good and bad times? Investment in well-chosen Philippine art pieces at a minimum of P100,000 to P150,000 could give a 10 percent to 30 percent in a year or two. For those who have a taste for the works of National Artists, the 1972 Bencab acrylic on paper, estimated at $19,000 to $26,000 eventually sold for $54,000, writes Giselle Kasilag in Kulay-Diwa website. With stock, currency, bonds and commodity markets all over the world always in a state of flux, investors may find it worthwhile and less stressful to buy paintings instead of financial instruments. Or at least use this alternative form of investment to diversify his portfolio and spread his risks. The real return, however, may not be in the form of cash. Despite the possibility of high earnings, art patron Rico Hizon, who is also BBC World’s lone Filipino anchor, says the enjoyment that comes from the painting itself should be the primary return every art investor should consider. “Look at it as something that will lighten up your living room, give color to your bedroom. You shouldn’t buy art because you want to make money in two or three years,” Hizon said in an interview.Read more here.
"beat stock mart"? i seriously doubt artwork or collectibles can even beat T-bills. 20%+ commissions to buy/sell - highway robbery in stock mart terms! :D It's not liquid, it's subject to damage and theft, and I don't count it as a productive asset in the likes of malls, farms or factories. It's cool and okay if you're an art aficionado and / or you're doing it to support your fave artist. But better assume that money is spent until the market tells you otherwise.
follow up comment... speaking of collectibles, I collect coins myself. Nice education and diversion from study and work I get out of it. But in hindsight the money's better off going into equity funds. The real cash was made in gold I bought for $300/oz and silver at $3/oz (now it's $900 and $18).
So for hobbyists out there, just keep a reasonable budget for collectibles, do it for the thrill, and just let time tell you ten years from now which of your items will give you the best returns (bullion gold and silver, in my case).
I tend to agree. Art is very risky and illiquid. Id rather invest in a mutual fund than in art. I remember a news a few months ago that lucio tan was mad at one of his sons for buying 3 pieces of paintings for 20k-100k each. :)
Yaman na talaga ni Rico Hizon :)
Art investment, wine collection etc is for those with lots of extra money. First of all, you may have to keep it for a very long time (probably the next generation) before said collection gets a premium market value.
Stock market and equities is still the way to go for ordinary people wanting to increase their retirement money.
I will not invest my money on ART I rather invest my money on FOOD/DRUG you can't go wrong! For instance when VON Grocery store first trade on NY STOCK EXCHANGE I bought the stock for $7.00 dollars a share, Then It went up to $23.00 a share. I sold it and make profit. You can make money on stock market in fact there is lots of people become rich's.
A friend of mine works at a bank and she says equity is still the best investment. Her 50,000 more than 5k a month. U will never get that from a savings account or time deposit.
Hi hachiko! Hows it going in japan? I used to live there as a student. I hope I can connect with you and talk about japanese stuff. I miss that country so much.
Ria Says:
April 4th, 2008 at 11:58 am
Yaman na talaga ni Rico Hizon
Art investment, wine collection etc is for those with lots of extra money. First of all, you may have to keep it for a very long time (probably the next generation) before said collection gets a premium market value.
Stock market and equities is still the way to go for ordinary people wanting to increase their retirement money.
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Yep! Ria: You're absulotely right!
If there is 401 (k) Where you work the best way is to put aside on your 401 (K) Atleast 10% of your salary but if you can save more by all means save more. By the time you retired you've a Millioniare.
But of course I never work in the Philippines so I don't know if there is such a thing as 401 (K)
But if there is no 401 (K) in your company to invest the best way to do is save. Not in the bank, Because bank don't give you enough interest and regardless on how much money you save in the bank you still have to pay taxes, And the bank taken out Automaticly. This is what I know about the bank in the Philippines. I had bad experience banking on Philippines bank. I use to have dollar's account in PNP the more I save the more they're taken out taxes on my saving account. My siblings do their banking on Landbank the same problem. And just to think these bank's are government own. Shame on them. NOT ANYMORE!!!
cedric Says:
April 4th, 2008 at 8:50 am
I tend to agree. Art is very risky and illiquid. Id rather invest in a mutual fund than in art. I remember a news a few months ago that lucio tan was mad at one of his sons for buying 3 pieces of paintings for 20k-100k each.
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Wow, Thats alot of money! You can help feed alot of poor people with that kind of money.
But for me, I won't just give it out I'll make sure the money I've given to the poor people will last for a long time. For instance where I come from I help alot of people who want to invest but don't have any money to do it. Most of them just want to take care baboy because baboy only take three months you can sell and make money. I give them enough money to buy a boy/girl pig that way when they pig have babies they can sell it too. And make more money in the long run. I didn't expect anything in return with the money I give them, I only told them that everytime the pig had a baby they have to give some of the pig to other who can't afford to buy their own baboy. And these are still going on. Its a nice feeling knowing that even in a small way I can be of help to those who really needed help!
20,000. 100,000. Thats alot of money! I'll be very happy to give out all that money to help the poor people. Try it! you feel better in the long run! There is old saying, The more you give, The more you'll receive. Its true!
Purchasing art pieces should primarily be because you love it. Investing on it can be tricky because it is not liquid and caters only to a small segment of the market. As often said, banks in the Philippines are inefficient as evidenced by the wide spread between the borrowing and lending rates. With the meager interest rate being offered by the banks right now, I am not surprised that people are opting to keep their cash with them. And with the rising prices, we can just hope that it won't reach the hyperinflation rates reached in Latin American countries in the past.
My friend and I used to browse galleries and go to exhibits at PICC just for fun and if we find ones we really line, buy unframed paintings at a fraction of the cost of the framed ones. She did not really know the artist but she found a 8 x 12 inch piece interesting. When she had it framed 5 years later in 2000, the gallery wanted to buy it for P50K (My friend remembered the original price was only Php 900 -- she haggled it down with the artist). Apparently, the artist grew acclaimed and later, her works were featured at Sotheby with one selling at a record price for an Asian.
In contrast, I got several unframed work by another relatively known artist who to my dismay, was later accused of something not quite so savory by one of his models, and I was not comfortable keeping his work. He was later acquited and I regretted giving away the piece which had now appreciated in value.
I go by this: 1. choose something you like and would not mind hanging in your wall 2) buy small, unframed items. you can go bigger depending on your taste/budget 3) buy directly from the artist -- at least you have sort of assurance the piece is original and you cut the middleman. There was this famous artist's son who passed off his work as his dad's... so beware. 4) do not limit your media. My friend's P50K piece was just pen on paper. 5) visit the artist at the end of the day or at the end of the exhibit -- he/she is more willing to negotiate 6) enjoy looking.
yes,i agree with you how it's performed in the market recently, is demand for it growing or subsiding high. Considering all of this, the value of a reputable art appraiser can't be understated.
yes,i agree with you how it's performed in the market recently, is demand for it growing or subsiding high. Considering all of this, the value of a reputable art appraiser can't be understated.
its very misleading. stocks are more liquid than art work.
Well I agree that art is a good investment, but your money are tied up in these investments that are very hard to liquidate and no readily available buyers. If you really need the money then you may even be forced to sell at a loss.
Every piece of art is different and I'm glad I own some artwork which I bought without thinking that I'm investing. It's a good tip that art piece can be liquidated when we need money but I don't think it'll be that easy to find a buyer and also if the piece of art is not from a famous painter or the picture itself is not appealing to others it may not fetch us half the amount we spent.
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