THE BEATLES VS. THE STOCK MARKET

High-net-worth investors have turned to fine art & collectibles while the financial markets recover

Autographs of The Beatles and drawings and handwritten lyrics by John Lennon have sold at auction in recent years for “very impressive amounts,” says Maureen McCarthy, director of Imagine the Art of John Lennon Gallery in Sydney, Australia. She is the local agent for Australia and South East Asia of Bag One Arts Inc., the licensing and publishing arm of the estate of John Lennon under the direction of Yoko Ono.

Increased interest in fine art through the recession has kept values increasing, making art and collectibles “a much better investment” in the last five years than the stock market, says Bill Gatewood, head of the Personal Liabilities Division at Burns & Wilcox. Art indices since 2008 have shown better results than the Standard & Poor’s index, while the Dow has been “very sluggish” until the last year or so, which has had an impact on the value of art, Gatewood says.
Art is “increasingly” becoming a vehicle for investment because of its high appreciation and few requirements to obtaining and holding a piece, says Jennifer Schipf, vice president and senior underwriter of XL Group’s North American-based Fine Art and Specie operations. “The appreciation of values is what makes it a nice investment,” Schipf says. Most major banks have a lending practice against fine art as collateral. “As underwriters, we have to be careful to understand the risks that we’re actually writing and not take things at face value.”

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