FULFILLING COMMITMENT
DEAR FRINDS,
WISH YOU A HAPPY NEW YEAR.
AT THE OUT SET I WOULD LIKE TO SHARE THE FACTS THAT I AM A COPAL ART"s INVESTOR SINCE LAST TWO AND HALF YEARS, WITH A COMMITMENT GIVEN THAT MY INVESTMENT WOULD BE INCREASED 3 FOLDS IN A YEAR OR TWO.ON THE COMPLETION OF 1ST YEAR I APPROACHED THE COPAL TO GET SELL MY PAINTING JUST TO CHECK AND GAUGE THE RETURN ON INVESTMENT. BUT NOTHING COULD HAPPEN AFTER FFULFULLING THEIR SALE PROCEDURE AND SERIES OF COMMUNICATIONS. INSTEAD THEY PUT UP DIFFERENT CONDITIONS.
NOW TODAY AFTER ALMOST TWO AND HALF YEARS WAITING WHEN IAM REALLY IN NEED OF FUNDS FOR MY SON'S HIGHER STUDIES THEY AGAIN WANT ME TO FOLLOW THE SALE PROCEDURE AND ALSO TRYING TO CONVINCE ME THAT THERE IS A RECESSION AND IN SHARP CONTRAST THEIR "COPAL KNOWLEDGE SERIES" MAILS REFLECTS THAT "X" ARTIST's PAINTING WAS SOLD FOR SO MUCH AMOUNT AND SO ON . THEN WHY NOT MINE.?
IN SHORT NO SERIOUS EFFORTS ARE MADE TO KEEP THEIR WORDS WHILE SELLING THE PAINTING TO THE SMALL INVESTORS LIKE ME TO GAIN OUT OF RESALE.
REGARDS
KALYAN HARIBHAKTI
WISH YOU A HAPPY NEW YEAR.
AT THE OUT SET I WOULD LIKE TO SHARE THE FACTS THAT I AM A COPAL ART"s INVESTOR SINCE LAST TWO AND HALF YEARS, WITH A COMMITMENT GIVEN THAT MY INVESTMENT WOULD BE INCREASED 3 FOLDS IN A YEAR OR TWO.ON THE COMPLETION OF 1ST YEAR I APPROACHED THE COPAL TO GET SELL MY PAINTING JUST TO CHECK AND GAUGE THE RETURN ON INVESTMENT. BUT NOTHING COULD HAPPEN AFTER FFULFULLING THEIR SALE PROCEDURE AND SERIES OF COMMUNICATIONS. INSTEAD THEY PUT UP DIFFERENT CONDITIONS.
NOW TODAY AFTER ALMOST TWO AND HALF YEARS WAITING WHEN IAM REALLY IN NEED OF FUNDS FOR MY SON'S HIGHER STUDIES THEY AGAIN WANT ME TO FOLLOW THE SALE PROCEDURE AND ALSO TRYING TO CONVINCE ME THAT THERE IS A RECESSION AND IN SHARP CONTRAST THEIR "COPAL KNOWLEDGE SERIES" MAILS REFLECTS THAT "X" ARTIST's PAINTING WAS SOLD FOR SO MUCH AMOUNT AND SO ON . THEN WHY NOT MINE.?
IN SHORT NO SERIOUS EFFORTS ARE MADE TO KEEP THEIR WORDS WHILE SELLING THE PAINTING TO THE SMALL INVESTORS LIKE ME TO GAIN OUT OF RESALE.
REGARDS
KALYAN HARIBHAKTI
Replies to This Discussion
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Permalink Reply by Amit Chopra on -
Check out tulipomania on google search.I think you'll understand the similie.
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Permalink Reply by Arun Jethmalani on -
I agree with the tulipmania idea... and have more to say on this at http://indianotes.com/jetusblog/investing-in-art-funds-%E2%80%93-ho...
would love to know whether you agree or not?
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Permalink Reply by Bhupesh gupta on -
dear arun,
reproducing your blog here for easy viewing in one place.
my reply just in three lines.........
greed is god !
but i totaly dismiss the view that all art is a fad.
a fool and his money are soon parted.
Investing in Art Funds – how Greed makes us foolish
Recent outrage on the raw deal investors have got with Osian’s art fund would be funny, if only many “innocents” hadn’t got burnt. Talking about manias, this was surely one – or at least a micro-mania!
The fund raised over Rs 1 billion, and several others (Edelweiss Capital Yatra Art Fund. Religare Arts Initiative, Copal Art fund, Crayon Capital Art Fund, Kotak India Art Fund and Indian Fine Art Fund) got into the act (circa 2006-2008). Since art funds are not regulated, nobody knows exactly how much money was raised. However, newspaper reports suggest a sum in excess of Rs 3 billion.
Investing history is littered with stories of illogical behavior by greedy human herds, and this is no different. Firstly, art is highly illiquid (and that’s an understatement!). There is no established market, nor any regulation, nor transparent price discovery. Huge commissions to auction houses or brokers mean enormous transaction costs. Finally, valuation of art, is itself an art!
There is no apparent method, except for having “an eye” for art. There are “art experts”, but there is little evidence of correlation between critical acclaim and market price. In fact, many highly touted artists of the 18th and 19th century are in oblivion today.
In other words, value depends on popularity – which I could define as a fad. Some fads, like Rembrandt or Picasso may endure for decades (or longer), but these are very (very) few. The vast majority remain unknown. And since there is also no scientific tracking of prices of all artists, the few blue-chips create new benchmarks and generate hype. But what is the percentage of blue-chip artists to the entire artist universe?
Supply is highly elastic and dwarfs demand, so majority of art does not sell at all or if it does, is unlikely to appreciate very much.
Despite all the obvious negatives, investors bought art funds, that too funds with very short horizons. And now, we are all blaming the fund promoters and distributors for making unrealistic promises. This might help vent our frustration, but why did we believe them?
I agree that lack of regulation has worsened matters, but no amount of regulation can prevent crackpot schemes build around popular fads. Ultimately, nobody out there can protect you if you’re careless with your own money!
Would welcome your views on investing in art, especially if you disagree with me.
Arun Jethmalani said:I agree with the tulipmania idea... and have more to say on this at http://indianotes.com/jetusblog/investing-in-art-funds-%E2%80%93-ho...
would love to know whether you agree or not?
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Permalink Reply by Bhupesh gupta on
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i’m tempted to rate this article 2/5 for it’s understanding of matters of art !
though it’s lacking in overall assessment of art as a mere fad it does score in honesty and touches a chord when it comes to greed alas the final notes are jarring to say the least!
it’s entirely true that popularity (only in the case of time tested artists with a proven record over a period of time) drives the values it can’t be a fad probably you can add other artists which were nowhere near these parameters and their prices were hugely manipulated thanks mainly to herd mentality of cocktail circuit which failed the acid test to leave so many pockets with a burning hole!
Ultimately, nobody out there can protect you if you’re careless with your own money!
Investing in Art Funds – how Greed makes us foolish
Recent outrage on the raw deal investors have got with Osian’s art fund would be funny, if only many “innocents” hadn’t got burnt. Talking about manias, this was surely one – or at least a micro-mania!
The fund raised over Rs 1 billion, and several others (Edelweiss Capital Yatra Art Fund. Religare Arts Initiative, Copal Art fund, Crayon Capital Art Fund, Kotak India Art Fund and Indian Fine Art Fund) got into the act (circa 2006-2008). Since art funds are not regulated, nobody knows exactly how much money was raised. However, newspaper reports suggest a sum in excess of Rs 3 billion.
Investing history is littered with stories of illogical behavior by greedy human herds, and this is no different. Firstly, art is highly illiquid (and that’s an understatement!). There is no established market, nor any regulation, nor transparent price discovery. Huge commissions to auction houses or brokers mean enormous transaction costs. Finally, valuation of art, is itself an art!
There is no apparent method, except for having “an eye” for art. There are “art experts”, but there is little evidence of correlation between critical acclaim and market price. In fact, many highly touted artists of the 18th and 19th century are in oblivion today.
In other words, value depends on popularity – which I could define as a fad. Some fads, like Rembrandt or Picasso may endure for decades (or longer), but these are very (very) few. The vast majority remain unknown. And since there is also no scientific tracking of prices of all artists, the few blue-chips create new benchmarks and generate hype. But what is the percentage of blue-chip artists to the entire artist universe?
Supply is highly elastic and dwarfs demand, so majority of art does not sell at all or if it does, is unlikely to appreciate very much.
Despite all the obvious negatives, investors bought art funds, that too funds with very short horizons. And now, we are all blaming the fund promoters and distributors for making unrealistic promises. This might help vent our frustration, but why did we believe them?
I agree that lack of regulation has worsened matters, but no amount of regulation can prevent crackpot schemes build around popular fads. Ultimately, nobody out there can protect you if you’re careless with your own money!
Would welcome your views on investing in art, especially if you disagree with me.
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