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Investing in art has traditionally been considered a field where intuition, taste, and deep knowledge of a specific artist or movement play a major role. However, the modern art market is becoming more transparent and accessible to a wider range of investors who prefer to rely not only on subjective opinion but also on objective data.
Investing in art has traditionally been considered a field where intuition, taste, and deep knowledge of a specific artist or movement play a major role. However, the modern art market is becoming more transparent and accessible to a wider range of investors who prefer to rely not only on subjective opinion but also on objective data.
It is for this purpose that analytical tools known as art indexes were created. They allow for the assessment of the overall market condition, tracking its dynamics, and comparing the profitability of art investments with other asset classes, such as stocks or real estate. This helps in making well-informed investment decisions based on numbers and facts.
In essence, an art index is a statistical indicator that tracks the change in value of a specific group of artworks over time. It can be compared to stock market indexes, such as the S&P 500 or Dow Jones, which reflect the overall state of the stock market. An art index performs a similar function for the art market.
The main purpose of such a tool is to provide investors and analysts with a generalized picture of market trends. This helps to understand whether the market is growing as a whole, which segments are showing the best dynamics, and how art compares to other investment opportunities.
| Term | Description |
| Repeat-sales method | An index calculation methodology based on comparing the prices of the same asset upon its repeated sales. |
| Sub-index | A part of the main index that tracks a specific market segment (e.g., Old Masters or Impressionism). |
| Volatility | An indicator of an asset's price variability, characterizing the level of investment risk. |
One of the most famous and authoritative tools in the world of art analytics is the Mei Moses index. Its uniqueness lies in its calculation methodology, which is based on the analysis of repeat sales. This means the index only tracks artworks that have been sold at public auctions at least twice.
By comparing the price of the first and subsequent sales of the same object, the index creators obtain precise data on its returns. This approach allows for the elimination of the subjective factor of quality assessment and focuses exclusively on the change in market value. The index predominantly covers Western art and is divided into several sub-indexes for different categories.
| Parameter | Mei Moses | Artprice |
| Methodology | Repeat-sales method | Hedonic regression |
| Data Coverage | Only repeat-sale works | All works sold at auction |
| Main Product | Returns index | Extensive database and indexes |
| Advantage | High accuracy for specific objects | Broad coverage of the entire market |
Another key player in the analytics market is Artprice. Unlike Mei Moses, Artprice is not just an index but a vast database containing millions of auction results from around the world. Based on this data, the company calculates its own market indicators, including the Artprice Global Index.
To calculate its index, Artprice uses a different method—hedonic regression. This approach considers numerous characteristics of an artwork (author, size, technique, year of creation, subject) to determine how each of them affects the price. This allows for the inclusion of data on works that have been sold only once, significantly expanding market coverage.
Art indexes are powerful analytical tools, but it is important to use them correctly. They do not provide direct instructions on what to buy or sell but serve to form a general understanding of the market situation and make strategic decisions.
For an investor, working with indexes can be structured in several ways. This helps to move from intuitive purchases to creating a balanced, data-driven investment portfolio.
It is important to remember that indexes reflect averaged market data. The success of a specific investment still depends on choosing the right artwork, its authenticity, provenance, and condition.
