2013 results for first art fund based on a private collection

   |  28 January 2014  |  AMA  |  Tweet  |  LinkedIn

Gibraltar, 28 January 2013, Art Media Agency (AMA).

Art Vantage LTD PCC has release a press release detailing their 2013 performance, reporting a 9.39% increase in investor returns in 2013, and a cumulative 27.5% since its inception.

Art Vantage LTD PCC – which describes its aims as “transparency, clear macro investment strategy and strong uncorrelated returns” – owns the Tiroche DeLeon Collection, which invests in leading contemporary artists from developing markets. The collection acknowledges dominant names in each of the regions it buys, discovering emerging artists and working with museums, galleries and curators “to build long-term value”. Its approach combines ethical collecting with long-term, macro-drive market exposure, and an active management strategy.

As of 31 December 2013, the fund was valued at US $16,693,084, containing 300 works by artists including Marina Abramovic, Ai Weiwei, El Anatsui, William Kentridge, Pedro Reyes, and Liu Rei.

The fund has a stated a return objective of 10% per annum over its lifetime. In December 2013, an independent valuation conducted by Phillips on 31 December 2013 showed the fund to have generated net investor performance of 9.39% (net of all operating costs, management fees, and performance fees). This figure gives a net cumulative investor performance of 27.5% since inception in 2011 – just over 9% per annum.

Despite this, Art Vantage LTD PCC claims to have maintained its 10% return objective over the past three years. Speaking via a press release, the company states that calculated returns are based on annual estimations of “fair market value”, provided by the three leading auction houses on a rotating basis. Works acquired by the company so far have been at an average premium of 25% to these valuations, suggesting that the company may be trading at a discount to its actual value. According to their release, average gross annualised returns on all realised art works stands at 38%.

A comparison of the fund’s returns with those of other investment classes show its returns to have been relatively consistent, with the combination of low volatility, low correlation and strong return being touted as an appealing case for investment. The fund is presented by Art Vantage LTD PCC as being suitable for “experienced investors who can tolerate illiquidity and a degree of volativity”.

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