Once seen as a market only accessible to the rich, investing in fine art has become a popular hard asset to store your wealth.
Modern art has been so reliable that it experienced the lowest fall of all assets during the 2008 financial crisis.
So how do you get started with art investing in the first place? With an innovative platform like Masterworks, getting started is a lot easier.
Let’s delve into the site’s details and why it’s a great place to diversify your portfolio!
What Is Masterworks?
According to Masterworks’s CEO, Scott Lynn, modern art has consistently outperformed the S&P since 1996. This growing trend is why he and his team created a marketplace where virtually anyone can use high-end artwork investments.
From Pablo Picasso to Andy Warhol, you can store your wealth in blue-chip art pieces from the world’s most famous artists. Most of Masterwork’s paintings also have much higher resale value, translating into generous annual returns for their members!
How To Invest In Fine Art With Masterworks
Masterworks has a strict process to select which art pieces to include in the platform’s database.
Using dedicated research and acquisitions teams, they find high-value art being sold at a fair price. This way, you’re likelier to see a more significant boost in an art piece’s profit when it sells.
You can make money on the platform by purchasing long-term assets or making short-term trades.
Masterworks usually sell their paintings in 3 to 10 years. Once they do, the site takes 20%, and the remaining profits are divided among investors based on how many shares they own.
For short-term sales, you can use their secondary trading market to buy or sell shares as you see fit!
Learn How To Invest With The Site’s Content
New to art investing? One of the best parts about this site is how beginner-friendly it is.
Masterworks has many articles and other insightful content that can help you navigate the site and learn how to become a better investor.
But their content is a lot more than art assets. Covering topics surrounding NFTs, alternative investments, and crypto, the site offers a wealth of information to help anyone who wants to improve their knowledge.
How To Sign Up
Signing up for Masterworks takes more effort than other platforms. After you fill out the initial form, you’ll have to go through a mandatory phone interview with a team member.
While it may feel inconvenient, this is done for the company to personally get to know its investors and help guide you through your first investment on the site. You can also use this phone call to ask questions about the platform.
Masterworks: Pros And Cons
- Much higher annual returns than the S&P
- Relatively low minimum investment
- Strict selection process well-trained researchers to find the best art pieces available
- A wealth of content for beginners to learn how to invest
- Longer signup process with a mandatory phone interview
- A large cut of a painting’s sale goes back to the site
- You’ll need to wait a few years before you see returns if you don’t use the secondary market
- The secondary market is only available to US residents
The Bottom Line
You can’t go wrong with fine modern art if you want to diversify your portfolio into a reliable asset. It’s consistently outperformed traditional stocks for decades and hasn’t shown any sight of slowing down any time soon.
But, like other investment opportunities, don’t put your eggs in one basket. Art is still considered high-risk, and if an artist or style stops being relevant, it’ll wreak havoc on your portfolio if you don’t diversify.
Luckily, there are platforms like Masterworks that do most of the hard work of selecting art pieces that have a higher chance of returns. If you want to try Masterworks, sign up for an invitation today!
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