A report by UBS Wealth Management Americas, titled ‘For the love of art’, has found that 65 percent of investors have never sold a piece from their collection, while 41 percent have never had their collection appraised.
The special Investor Watch Pulse Report, released during Art Basel in Miami Beach, found that art collectors find themselves driven by an appreciation for beauty (71 percent), a desire to follow their passions (54 percent) and a wish to support and nurture artists (32 percent). A quarter of investors consider their collections to be priceless, emphasising that passion rather than profit is a motivating factor.
Head of private wealth management and ultra high net worth, UBS Americas, John Mathews, commented: “Collecting is a passion that we share with many of our clients who are developing alternative legacies through their cultural pursuits. Collectors don’t apply the same principles to buying art that they would to a typical investment portfolio of stocks and bonds.
“It is important, however, to institute management structures to ensure their legacy remains protected, correctly valued and insured.”
Furthermore, 88 percent of collectors do not use an art adviser to guide their purchases, while 62 percent of collectors use galleries to educate themselves on fine art purchases. This is followed by online resources (60 percent), museums (50 percent) and magazines (44 percent). One in four collectors admit to purchasing art online, sight unseen.
Collectors of fine art, compared to coin, stamp and jewellery collectors, plan to leave their art to heirs rather than sell it (87 percent), with 90 percent of heirs feeling ‘honoured’ to inherit an art collection, while 81 percent intend to keep it.
Contrastingly, 35 percent of heirs who received other collectibles, including coins, stamps and jewellery, were interested in it according to a recent Investor Watch Report called ‘For love not money’.
Despite the interest in maintaining a legacy, 57 percent of art collectors have not taken steps to educate their heirs on how to manage, appraise and/or sell their collection. “We’re seeing sentimental value tends to supersede financial value,” said head of client strategy, UBS Wealth Management Americas, Sameer Aurora.
“Collectors do not appear driven by the monetary worth of their art collection, and therefore are often unaware of its true value.”
|RATE THIS ARTICLE|
THIS WEEK'S TOP STORIES
PAM (Private Asset Managers) and its sister website PAMonline combine to provide "...the best guide available to the leading firms in private client fund management" (FINANCIAL TIMES). PAM compares managers on a level playing field by key data such as fees and charges, minimum investment thresholds and so on.