Indulging Your Sense: Reaping a Windfall through an Artwork Investment

“When people are highly educated and are willing to pay, they will learn about the value of that stuff and would want to own some. When the scarce supply doesn’t meet the excessive demand, the price will be rising as usual.”

It’s quite clear in my mind that it happened at the beginning of 2013 while I was glancing around my bedroom after waking up in the morning. I found out that the wall beside the TV set was blank. 

‘I should have something on the wall,’ thought to myself. In the evening on that day, I went to see my senior and told her about my irritating feeling, so she suggested that I should make a visit to her boyfriend. He was an art collector. Perhaps, there might be something that could curb my irritation or some good advice. A few days later, I dropped by at his place. With his mercy, he invited me through several rooms where exquisite art pieces from Thai artists had been mounted on the walls including sculptures standing in the room. Some were well-known among collectors. But to me, they just looked fine as I didn’t have any background of art nor art appreciation at all. I hadn’t heard of most of the artists except Thawan Datchanee and Chalermchai Kositpipat who were frequently on screen or TV programs. 

Before leaving, he led me to a pile of paintings lying on the ground as there was no space left to hang them. Strikingly, an oil painting looked so amazing. It was a picture of an ebony elephant painted by quick strokes. The brushstroke and scattering oil drips gave a feeling of frantic motion of the elephant breaking out its frame annihilating any barriers for freedom. This was painted by Thawan Datchanee. I, carefully, asked about this painting and the price of whether he would let me have it on my own. Fortunately, he could let me have it at a cost price. However, the cost was not a buck or a dime. With this amount, I could own a handy Eco-car. At that time, a feeling of doom overwhelmed my senses. The other paintings with a bargain price were lying anywhere in the room but this. This was the finest one. The special one. Despite its allure, I could not make up my mind to make an effort as I haven’t paid a large sum of cash for the painting before. Consequently, I tried to negotiate to borrow that painting to post on my bedroom wall. If it fits, I will make the decision to purchase.

Of course, as expected, once that picture was hung on the wall, I fell in love with it. It fit the space as if they were born for each other. Moreover, the hues of the painting and the color of the frame were best matched to the tones of the room furniture. What a coincidence! The next morning, I had to make a call to the seller, my senior’s boyfriend, and accept the deal.

In the afternoon at Siam Paragon Department Stores, I was confronted with the green ATM cash machine. Reluctantly, in the last minute, in fact in the last second before pressing the transfer button, I had changed my mind and turned back. I walked towards the ice-cream parlor in the hope that the cool and sweet ice-cream could calm my nerves down for half an hour. Then, I was standing in front of the cash machine again. Once, while I was going to press the button, my nature was calling instantaneously. Of course, I turned my back to the toilet again and made my mind like a mouse circulating in a maze for a while. Then, the third time I was facing the machine, I took a deep breath and pressed the transferred button for the costly painting without anything in my mind. Since then, the powerful ebony elephant has belonged to me. My first dearly painting, which I seriously and heavily invested, has been a part of my life. That month, the instant noodle cup was my regular basis meal for living.

As if my wealth was robbed in the thin air, I tried hard to indulge myself with the painting and to forget about the amount I paid. A few months later, there was a senior who worked as an art trader called for a request for the painting and proposed an attractive price. The price of a handy Eco car became the price of a luxurious sedan. I, hesitantly, declined his offer. But at least, the price he proposed helped relieve my feeling from being robbed to the feeling of winning the first lotto prize.  As the old saying goes, an investment in collectibles can produce a high return which is unbeatable when compared with other kinds of investment. If lucky enough, the yield can be ten times or a hundred times in return. The accumulated value of collectibles is correlated to the emotional value, a number of limited edition, or popularity among people. For example, some old stamps, coinages, banknotes, amulets, antiques, watches, automobiles, jewelry, handbags, wine, and artworks can be counted as value collectibles which are worth investing. When people are highly educated and are willing to pay, they will learn about the value of that stuff and would want to own some. When the scarce supply doesn’t meet the excessive demand, the price will be rising as usual.

No matter how high the price is, most of the international organizations have collected the global collectibles statistic data to launch an indicator index of investing interest. According to Knight Frank’s Luxury Investment Index, it found that, in 2017, the accumulated value of collectibles averagely increased especially artworks which contributed 21% in return followed by wine for 11% and watch for 5%, respectively.

Collectible investment can satisfy your feeling and emotion rather than a financial investment. The collectible can help you relax and release your stress. You would feel challenging when you explore the world in the search for something that best matches. They can be fondled, can be kissed, or can be your sleeping mate with a good dream. You don’t need to be scared of the downturn of a vulnerable financial market or the fragility of the economic system. This is because they are a tangible asset, not a numerical asset. Their values can be stored through the course of time unless they are lost or decayed.

            For those who start collecting especially the artworks which seem to produce the highest yield on return, it is advisable to study lots of information from copious sources: textbooks or specialists. You have to be knowledgeable enough to crystalize your idea and tell anyone about what you have learned. It’s not just only waking up in the morning and feeling like there must be something to fit the blank wall. Then, you kept rushing to your senior’s partner’s place and took a picture of a big black elephant back home without any deep understanding. It’s suggested that browsing various kinds of artworks from art books, galleries, or museums can help you to refine your sense and theme of the collection. The theme of the collection is essential since we are not as wealthy as Arabian sultans who are able to collect anything from the pestle to the warship. To scope down the theme of the collection can contribute your collectibles to look more amazing without enormous spending. For example, your themes can be scenery pictures, sculptures, portraits, or nude pictures which may make you look lustful. It would be more acceptable if it is claimed as a part of an art-piece collection. Otherwise, the theme can be the art-styles, such as impressionism, or Thai culture. As well as this, the theme can be specified according to the artists. For instance, you may focus on the artworks of one artist whose works can be ranged from his youth, his self-exploration period, his blooming period, and his elderly period. Themes can be indicated by timing intervals, such as Thai modern art which ranges from pioneer time to the current time. The theme can be set correlated to the international museum theme and can be filled up like the losing piece of the whole jigsaw. It is unwise to collect without planning.

The professional collector always says that to invest wisely, you must pick just one that your budget allows for. For example, if you have only THB 100, don’t pick up 10 pieces with THB 10 each. But the only one with THB 100 is worth paying. The quantitative collection does not mean good collection whereas the quality of the collection is crucial. Less is more. It is better if you focus on one specific theme rather than a pile of nothing. Peggy Guggenheim’s collection in Venice, Italy is a good example. Her collection can be considered as a quality collection. She collected more than 100 pieces but every piece is fantastic with a similar theme. Her collection is properly set in a few rooms, in the garden, and on the lawn. It is as impressive as walking in the Louvre Museum in Paris where the art-pieces have been stored 10,000 or 100,000 times more than hers.

            One more trick to start collecting artwork, if you are affluent enough and would want to make sure in the return of your investment, you can collect only the well-known artists’. Nevertheless, to make a profound study in that artist and his style is crucial in order to have the right selection. This is because not all artworks made by your favorite artists are popular. On the other hand, if you don’t focus on the high-profile artists’ works, it is unnecessary to allocate a heavy amount of cash. All you need to do is to keep your eyes on the newcomer artists and provide them nice support. Then, you may have a chance to own some fine artworks at a reasonable price. If you are a shrewd investor, you need to study the artists’ career background. For example, you can research their exhibitions, awards, their identities or their original ideas portraying through their artworks whether they are representations of other artists or not’.  Last but not least, the consistency of producing artworks is compulsory. For example, some artists may produce a lot of paintings this year, but next year they might switch their careers to be sellers of Douhua, the Chinese sweet.

One notable example of a deficient couple who are passionate about artwork collection is Herbert and Dorothy Vogel. Herbert worked as a sorting mail staff while Dorothy worked as a librarian in the public library. Both of them received thrifty payments and lived as tenants in a cheap tiny apartment in New York, USA. This couple had an economical living based on monthly earnings that allowed them to do so. They could not own a car nor pay for a holiday. They could only have meal boxes at home. Surprisingly, they saved up a small amount of cash to own some artworks from the newcomer artists. They chose some small pieces which could be carried through the subway. If the price is too costly, they will ask to split the payment into smaller installments. They had done similar practice for 50 years until there was no space left in their tiny apartment. Piles of artworks were everywhere; under the tables, beneath the closets, or a bed. Approximately, there could be 5,000 artworks. Some of them were bought during the artists’ incubation period. Recently, they found out that those artists have become well-known and their collectibles have become priceless. Their collectibles were created after 1960 which was an important period for the USA. Instead of selling their artworks for their sumptuous living, they decided to bequeath their collectibles to the National Museum in Washington DC. This is because this museum does not have any policy to sell the donated objects and does not charge the entry fee at all. The public can access and appreciate their live-time collectibles for free. Their generosity should be praiseworthy and should be taken as a role model. Then, I have discussed this matter with my wife whether we should have a similar practice like them.

As I told you, artwork collectibles can be a good investment which is worth money. However, it should be disclaimed like at the end of a financial investment document, “There are risks associated with the investment. Investors should study the information before making a decision.” The risks can be generated as artificial artworks, overpricing, the decline in popularity, and poor storage conditions causing damages to the artworks. Apparently, it is not difficult to get the new owner for the famous artworks, but the liquidity of this investment is not as good as financial assets like gold or shares which can be cashed out anytime through the goldsmith shops or brokerages. Additionally, if you want to trade or convert your artworks into money via the medium men like galleries or auction companies, at least 10-20% for the commission fee will be deducted from the auction price. This is not a pittance. 

For me and those who have shared something in common, our hoarding sense can be a contagious disease. The aims to have a quest for artworks and to be surrounded by them are neither for trading, nor fortune but to serve our desire. Once, when learning that the market price of my own artworks is rising, I would bear a rational explanation to own a new one. This wouldn’t make me regret it when paying for the new piece. This could be the highest risk for the collectors as they don’t want to release their collectibles to anyone else. Then, when can the windfall be reaped? I have no idea.