Tuesday, February 20, 2018

Art as Inflation Hedge Sothebys Stock Rockets

April 22, 2010 by  
Filed under Inflation Hedge Strategies, Move

While gold, precious metals, commodities, and the stock market are inching their way back to pre-Lehman Brothers prices, the fine arts market hasn’t totally bought into the (so-called?) recovery yet. According to Reuters though, art might be finally be ready to turn around as well.
They reported on April 16, 2010, “The once-hot investment is on the verge of solid recovery.”

Independent fund manager Castlestone Management, which specializes in alternative assets for global clients, has said it anticipates a 40 percent rise in art prices over the next two years.

Citing a 70 percent rise in equities prices since late 2008, Castlestone noted that “equities is considered to be a key indicator when analyzing trends in the art markets.”

It compared the market to gold, which has appreciated 50 percent since November 2008 and which, like art, “is an unleveraged, irreplaceable real asset which investors turn to” during unsteady economic times.

One art play the venerable old auction house Sotheby’s BID is up more than 500% since March 0f 2009. It closed on April 22, 2010 at 38.10, coming off it’s low of 6.27 on March 9, 2009. Yet the stock would have to increase by another 68.5% in order to get to its high of 57.18 on October 12, 2007. Whew!

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