"Art is an overlooked investment class that regularly beats traditional return ratios and can provide a wealth of opportunity." (FT Adviser, October 30, 2008).
Art offers to investors a unique opportunity for portfolio diversification into an area that has historically provided high returns and shown a low correlation to conventional asset classes such as equities, bonds and real estate.
Art has not only an attractive risk-return profile, but it can also protect against inflation and currency devaluation.
Moreover, the risk decreases as art holding period increases without substantial changes in return.
Both investors and collectors would thus benefit from allocating 1-10% of their wealth to fine art and collectibles.