Survey: Alternative Investments – The Fine Art Of Investing – As The

First, even the most complicated “hedonic” table has trouble coming to terms with the one-off nature of art as a commodity. More importantly, collectors, who often spend their working lives studying screens, want to enjoy buying art. They may realise the benefits of expanding their portfolio into art, but they want to buy the art for its own sake. Passion can be a better guide than financial assessment in a market that questions the world in which we live and searches for beauty.

Beauty no longer maintains the monopoly position in the world of art that it used to enjoy. Artists and collectors alike are looking to explore the definition of art. Many artists, such as the photographer Wolfgang Tillmans, are actually blurring the lines between art and commerce, and even attempting to weld them together. When he mixes his commercial advertising shots with his “art” scenes, he is pointedly questioning whether there is any difference between them. Charles Saatchi, incidentally a key collector of Mr Tillmans, walks a similar tightrope between being a collector and a dealer. He exerts a far greater influence over the contemporary art market than any dealer in the world. Some argue that the Saatchi phenomenon is a classic example of investment buying, a cynical manipulation of the market. But Mr Saatchi did not go into art to make money. He was led there by a passion that borders on obsession. The trouble for the contemporary market is that there are not enough collectors on the same scale to balance his impact.

Mr Saatchi’s current control of the market offers opportunities for other collectors. His preferences have meant that alternative visions to the Saatchi look are not getting the attention they deserve. For instance, serious artists such as Susan Derges, who makes photographs without a camera, will be considered more important once the phase for one-liner art has died away.

Photography, both contemporary and old, is a rapidly expanding market as witnessed by the sheer size of the auctioneers’ catalogues. Yet the market is still at a relatively early stage, so unless a new collector splashes out for a Thomas Struth at a $250,000, the risks are not too high. It is perfectly possible to buy serious works for a few hundred pounds.

Limited prints are another easy way of entering the market as it is possible to pick up works by the most established artist for a fraction of the price of an oil painting. As a general rule, it is best to avoid large editions. The most sought-after prints are usually the ones in which the actual process of print-making is an important part of the work. Prints that simply reproduce paintings are not very interesting to the true print lover. As with most areas, it is best to befriend or employ an expert in the field. Not only is their knowledge of the actual prints invaluable, but they will undoubtedly be the first to spot trends. For instance, leading modern print dealer Alan Cristea has developed a very good barometer to the market. “Jasper Johns has been the key since 1985,” he claims. “His prices are the first to go up in a boom and the first to fall. Now it is Johns and Warhol – Warhol as the ultimate populist artist and Johns as the cerebral American printmaker.”

Speculators in art often pay too much attention to fashion and the art world is as fashion-ridden as the rag trade. As the market is so small and deals primarily in one-offs, it is much more difficult to succeed by simply following a market leader. Of course the biggest rewards, both financially and academically, are to be found in the neglected areas of the art world – and there are plenty of them. Since the collapse of classical education, for instance, there are masses of bargains in antiquities. Just to make it more exciting, there are a good number of fakes and it is all too easy to find yourself with illegally smuggled items. But investors can buy Roman rings and earrings for hundreds of pounds, and Egyptian glass at the same level.

The auction houses are constantly looking for new areas to develop, opening up departments in boom times only to shut them down again as soon as recession bites. Twentieth-century design has been one of the most intriguing. Throughout most of the twentieth century, Britain was a fairly backward-looking nation, so didn’t support its artists, designers and craftsmen as well as many other countries. But ignorance often supplies opportunity.

It is impossible to overemphasise London’s dependence on the international art market. The British Antique Dealers’ Association (BADA) has just published a survey which showed that its London and south-east members sell 68 per cent of their stock abroad. This is even more clear in the contemporary market. Belgians buy more contemporary art in the London salesrooms than Britons. Yet the British are far more interested than they were 15 years ago, as witnessed by the renaissance in our museums and galleries. This is probably the best indication that art may prove a good investment.