Frequently Asked Questions
Long gone are the days where fine art was only to be enjoyed and profited by the mega rich. Here at ArtCap we create customised portfolios for clients to ensure that when the invest in fine art they are given tailor made advice to suit them.
Sales Process & Payments
Our sales process is truly what sets us apart from many other companies.
We make the lion’s share of our income on the exit and on a percentage of the profits our clients receive.
So on advising a client about the market we will establish a budget that he or she is comfortable with. We then begin looking to acquire and isolate a piece we believe will match the goals and objectives our client wishes to achieve.
Upon doing this we will send the details of the piece over for the client to look at and decide whether they are to take personal receipt of the work or not.
We then complete the process by giving the following options of payment; Secure card payment using PayPal, UK bank transfer to our HSBC corporate account or by cheque. Whichever method best suits the client, will be paid directly to ArtCap.
With certain suppliers who ArtCap use to source Fine Art our clients may be prompted to pay the supplier direct when this is the case funds will be send to a FCA registered custodian where the funds will be held to purchase the piece but the contract of sale still remains with ArtCap.
From this point the piece will be delivered to the predetermined location and the initial sales process will be complete you will then receive your receipt of purchase and where applicable a certificate of authenticity which will be sent to the address on the signed contract.
Limited Edition
When it comes to the term “prints” most people think of a copy of the piece as having little or no value. This is a misconception that is simply not true. More prints exchange hands than any other type of art and these are as likely to make money as an original.
A limited edition print run is a set number of prints created from a plate that is an exact impression of the original piece in question. There is a guarantee that after the set amount, for instance 25 have been made, that there will never be another print run of that individual work of art. This in turn is a way of limiting the supply and making sure the piece is not devalued. Most artists will also number the edition e.g. 6/25 to show the exact number that you own.
Limited edition prints are made in a number of ways depending on the time and style of the piece itself. For instance newer pieces are generally produced via methods of photography sometimes by the hand of the artist themselves, older works would have been produced using methods such as etching or lithography to create prints and once the desired number of the edition had been reached the template for that particular print would have been destroyed making further production of that piece impossible.
An artist is just one person so if he or she is in high demand you can rest assured that they would not be able to fulfil the demand for their work and for this reason the limited edition print market is very lucrative.
If created by the artist themselves these are still considered to be originals and not to be confused with copies.
Non-Correlation & Additional Benefits
The art market has consistently performed extremely well for a large amount of people over the years and this is not due to one reason alone.
Diversification
Art has long been integral to the assets of many of the world’s largest corporations. Fine Art is esteemed as a stable investment due to its non-correlation with other markets, making it an excellent diversification tool. Its performance often remains independent of traditional financial markets such as stocks and bonds, offering a hedge against market volatility.
Prestige and social benefits
Owning valuable art can bring social prestige and networking opportunities. Art collectors often become part of a community of like-minded individuals who share a passion for art.
Tax benefits
Depending on your location and the specific circumstances of your art investment, there may be tax benefits associated with owning and selling art. For example, some jurisdictions offer tax breaks for donating art to museums or other charitable organisations.
Tangible asset
Unlike stocks or bonds, art if a tangible asset that you can enjoy aesthetically while it potentially appreciates in value. You can display the artwork in your home or office, adding beauty and cultural value to your surroundings.
Investment Grade Art Categories
With the stock market you have categories of how well established a stock is, and the art market is no different.
Fine Art Investment is widely split into 3 Categories:
Blue Chip – These are the likes of Andy Warhol, Salvador Dali, and Pablo Picasso etc. These artists have stood the test of time and have solidified themselves in the history of art.
Mid-Career – These are artists that have had recognised sales and are on the up in the art world gaining the attention of seasoned investors and art experts.
Emerging – These are artists that are at the start of their career, these artists can reach the highest yields in a shorter time frame but are naturally a bit more risky. This would be like investing in an IPO or a company inside the first few years of trading.
Here at ArtCap we like to accommodate all of the above depending on our client’s budget and attitude to risk. We have a range of artists spanning all spectrums to accommodate anyone portfolio.
Sourcing
Our dedicated team work tirelessly to ensure that the pieces we advise our clients to invest in are of the highest quality and that all relevant checks are executed in regards to validity and providence of the piece in question.
ArtCap will only advise on pieces that we believe will have the desired effect of increasing in value. This is reflected in how ArtCap makes the Lion’s share of its income by charging a straight 20% on profits made.
Because of the way ArtCap makes the Lion’s share of its income (a percentage of the profit on sale) it is imperative that we source the piece at the lowest possible price and sell at the highest meaning that ArtCap and the investors interest in the market are aligned.
Taking all of the above into consideration our team have one consideration in mind isolating pieces of Fine Art with strong potential to increase in value over the mid to long term. Sticking to this strict strategy means that we cannot always accommodate personal aesthetic taste, ArtCap concentrate on the business of Fine Art as an investment and not pleasure. however if both are achieved then fantastic.
Physical & Online Galleries
With the number of purchases in the art world increasing it’s no wonder that the number of both online and physical galleries are shooting through the roof.
This is good news for everyone as it shows a clear and evident reassurance that the market and demand are growing and that there is money to be made in this market. Galleries essentially ‘invest’ into art in much the same way as our clients do. They buy the pieces from a source and mark up the product to sell onto a client, thus creating profit.
The issue with buying through a gallery is that the works have already had a lot of their margins taken out by galleries themselves meaning a desirable rate of return will take much longer.
This does not mean though that in some cases, we may be able to sell one of our client’s pieces off to a gallery at a profit if they believe they can still achieve more for it.