Art as an alternative investment choice

Art could be the alternative investment of choice for individuals with private wealth this year.

With risk remaining high in traditional investment categories, a number of investors are looking to diversify their portfolios, so as to ensure they are not too exposed to the current economic malaise.

And the Financial Times reports that one good place to consider putting money is in the art market, which has outperformed equities for the second consecutive year, according to the Mei Moses All Art index.

The measure showed that the value of art – primarily paintings sold at auction – grew in the UK and US by 11 per cent during 2011.

This was primarily attributed to increasing demand from China, particularly for popular artists such as Andy Warhol.

Philip Hoffman, chief executive of the Art Fund Group, told the news provider: "With China there is massive wealth. And the new wealthy want to show off their prized works to friends. It doesn’t take many to cause a surge in prices."

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