How The Art Market is Overtaking The Stock Market


As COVID-19 uncertainty lingers, many assumed that the art market would be affected. In reality, this market is not only thriving but also performing better than the stock market.

Art appraiser Barden Prisant shared his interesting findings on Forbes, revealing some very telling trends within art sales. He used auction prices to create a version of a Down Jones Industrial Average specifically focused on art rather than financial stocks.

Choosing selected contemporary art pieces spanning across modern, contemporary and 21st Century art, he gathered sales data for each artist’s work over the course of a week. He focused on prints, in order to be able to establish a reliable baseline to see how identical prints fared over specific time frames and determine the increase in value. He tracked sales on a global scale, across various countries, with sales primarily being tracked from the previous year.

Conducting his study in late March 2020, Prisant tracked changes in the stock market over a year. The Dow was at 25,626 on 28 March 2019. By that date the following year, it had dropped in value by 15%. Of the pieces analysed, three out of four works selected randomly showed an increase of around 16% compared to value before the pandemic. The average increase for 21st Century artists was around 14.5%. Some works had dropped very slightly in value, by under 5% with other works from artists such as Picasso increasing by as much as 41%. Read more about his full study to see which pieces were analysed.

What does this mean for the art market as far as investments go? Let’s take a look.

Why the Art Market is Overtaking the Stock Market

There are a few reasons for the growth of the art market even in the middle of a global pandemic. Many are starting to understand the value that contemporary art has as an investment. Online art sales are also on the rise, with auctions being done from the comfort of home. Live auctions have provided even more options for investors. Online art sales make it easier for new collectors to invest in art, too, with less pressure than traditional auctions. As we mentioned above, prints are in especially high demand, offering an affordable option for investors.

Tracking Hennie Niemann Jnr auction results over the last nine years have shown a steady increase in sales. His secondary art market performance relies on data by South Africa’s premium auction house, Strauss & Co. Between 2011 and 2019, 48 lots were offered with 83.33% sold to the total of R5, 624, 763. In 2019, 12 lots were offered, with 10 of these sold to the total of R1, 624, 000 – a market increase of 98% from the year before. Viridian Spring topped the world record at an internally recognised auction, with an estimated value of R150, 000 to R250, 000 and a sale price of R432, 440.

For those seeking an excellent investment that offers a steadily increasing value over the stock market, art is without a doubt the ideal choice. The art market is likely to continue to grow, making contemporary art prints even more sought-after.