Investors at Art Basel 'looking for cash alternative'

Low interest rates for cash have spurred much of the current drive behind the art market, according to art adviser Todd Levin.


Speaking to Bloomberg, the director of Levin Art Group explained that art provides an attractive way to invest for high net-worth individuals who are tired of seeing interest rates offered by banks and building societies at an all-time low.

His comments came amid Art Basel, the world's largest modern and contemporary art fair, which ran from June 18-21 in the Swiss city.

"It's about the need of high-net worth investors to park their excess capital," said Levin.

"They don't want to keep it in cash in the bank. They can't put it in a mattress. Art has historically provided the greatest intergenerational return of any asset class."  

His comments follow the release of end of year numbers from The European Fine Art Foundation (TEFAF), showing that the art market grossed $64.9bn in 2013 - the second highest ever sum(beaten only by 2007) and an 8% increase on 2012's figure.

A new survey from the US Trust shows that 60% of high net-worth individuals still have more than 10% of their wealth in cash, though 17% have planned to move money out of cash in the coming year.

Demonstrating the power of art investment, The Fine Art Fund Group reportedly sold $5m of art at the event, with compound gains averaging 10-20%.

Paul Fraser Collectibles can help form your collectibles investment portfolio - call us on +44 (0)117 933 9500 or email info@paulfrasercollectibles.com.

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