Why art is a preferred option for elite and wealthy investors?

Art 'remains a popular investment option for wealthy in the UK during tough economic times marked by a period of low interest rates and economic worries', a recent BBC News study mentions, quoting from the Royal Institution of Chartered Surveyors (Rics) survey.

Rics spokesman Chris Ewbank explains: "The art and antiques market remains a strong performer for buyers looking to invest in more tangible assets to guard against the uncertain economic picture." The trend of investing in ‘emotional assets’ is getting stronger with investors, having suffered from the global crisis, returning to objects ‘closer to their hearts’, which also provide some protection, liquidity and a decent ROI. As investment advisors explain, when you talk to people about a thing they understand, they love and also relate to, you are infusing positive emotions into investing.

Explaining the development, The Forbes news story (The Passion Portfolio: Investments of Love) elaborates: “With a turbulent market and a whole new generation of investors who equally value the ‘experience economy’, passion investing is experiencing a strategic resurgence. Whether it's 16th-century art, precious gems or Swiss watches, they are now adding collectible assets to the portfolios not only as a means of diversification, but also as a way of holding the things that they love the most.”

The report quotes Bernard Duffy of the London based Emotional Assets Fund as saying: "A clear convergence is happening between the realms of collecting and investing." Underling the strength of art market in this context, Philip Hoffman, the London based Fine Art Fund Group CEO, mentions, "It’s not highly speculative or trendy if you understand what you’re doing.

Over a 10-year period, if you’re buying the best, it is possible to double, triple, or even quadruple your investment." The trend now transcends geographic boundaries, with markets like the Middle East also showing more interest. "In countries like India and China, investors have historically had a higher predilection to hold tangible assets like gold, gems, jewelry and art - both as hedges against inflation and investments," explains New York based art advisory firm Artvest’s cofounder Michael Plummer.