TY - UNPB
T1 - The Monetary Appreciation of Paintings
T2 - From Realism to Magritte
AU - Renneboog, L.D.R.
AU - van Houte, T.
N1 - Pagination: 35
PY - 1999
Y1 - 1999
N2 - This study investigates how investments in painted arts compare to those in stocks in terms of risk return trade off using Sharpe and Treynor ratios and Markowitz efficient frontiers. A large database was analysed consisting of more than 10500 auction prices of Belgian painted art over the period 1970-1997. Hedonic art returns are influenced by auction location and auction house, current of art, painters’ reputation, medium, signature and painting size. Surrealism and luminism were the most popular currents of art (in monetary terms), while expressionism and symbolism gained (financial) esteem. This study concludes that art investments underperform equity market investments due to high riskiness, transaction costs, capital gains, resale rights, and insurance premia. In addition, the Markowitz efficient frontier shows limited diversification potential for art.
AB - This study investigates how investments in painted arts compare to those in stocks in terms of risk return trade off using Sharpe and Treynor ratios and Markowitz efficient frontiers. A large database was analysed consisting of more than 10500 auction prices of Belgian painted art over the period 1970-1997. Hedonic art returns are influenced by auction location and auction house, current of art, painters’ reputation, medium, signature and painting size. Surrealism and luminism were the most popular currents of art (in monetary terms), while expressionism and symbolism gained (financial) esteem. This study concludes that art investments underperform equity market investments due to high riskiness, transaction costs, capital gains, resale rights, and insurance premia. In addition, the Markowitz efficient frontier shows limited diversification potential for art.
KW - Investing in art
KW - Hedonic regression
M3 - Discussion paper
VL - 1999-62
T3 - CentER Discussion Paper
BT - The Monetary Appreciation of Paintings
PB - Finance
CY - Tilburg
ER -