James Tarmy has done what Bloomberg ought to do, compare the market for Monets to the US equities. There are a number of important caveats to keep in mind when comparing art to equities, including the fact that art may act as an alternative, non-correlated investment for a diversified portfolio but can never replace income producing investments like equities and fixed-income instruments.
Even so, Tarmy looked at the sale dates of two Monets on offer at Sotheby’s and compared those prices with a total return index based upon the Dow.
The actual numbers in the story are fascinating and well worth reading. But the upshot is all about market timing, especially considering the extraordinary performance of the Dow since 1982:
If you’d bought in 1962, you’d be doing great. If you bought after the 1980s, your returns against the Dow would be disappointing.
Does Monet Beat the Dow? How Artworks Perform as an Investment (Bloomberg)
