It seems as though every time we talk about making art an investment for the average person we start hearing diametrically opposed ideas in the same presentation. We’re told that you have to buy young artists to see real appreciation but that you should only buy the art you love and expect that it might never have value again. Here’s a good example from Jeff Macke’s excellent Breakout videos on Yahoo! and his interview with Kipton Cronkite:

“There’s been a lot of press around what high-end art has been selling for and I think it’s intimidating to the average investor,” says Cronkite, “but I think people should still get into this market and diversify their assets.”

[…] From a risk-reward perspective Cronkite says artwork resembles a penny stock. New artists may find their work selling for $500 to $1,000 but if they manage to stay in the marketplace and establish themselves, those values can gradually move higher but you probably shouldn’t bank on it.

“It’s anyone’s guess how far that artist is going to go. It all depends on the collectors that are buying the art, the curators that are selecting the art to exhibit in the museums” says Cronkite. It really requires a long-term approach.”

From $58 million balloon dogs to $60 street art, how you can profit from art mania (Breakout – Yahoo Finance)