The collectibles market is vast and covers everything from multimillion-dollar paintings to bottles of wine. It can be an escape for many a buyer and a labor of love, but there's no harm in looking at it as an investment as well.
The key, most experts will tell you, is to set a focus on an area (i.e. ceramics, furniture, textiles) and work in from there, studying the area and eventually buying the best.
Jonathan Rendell, deputy chairman of Christie's, suggests that RIAs or their clients look for collectibles where the investment can be easily tracked.
"There are certain areas where it's easier because either there is a large supply of similar material or [products] are in editions, so you can easily work out the impact what another one in an edition of 50 has made," Rendell explains.
He includes wine, jewelry, and print product markets in that list. For example, with jewelry, especially the hot, colored diamond area, a carat weight of a stone is easy to extrapolate to see how that market is doing in those particular stones. Print editions may be limited to 50-100 versions, and records are easy to access, he says.
"Same for Picasso ceramics," says Rendell. "The market has exploded in the last five years. It used to be a sleepy backwater, but now people are investing seriously."
In the world of Impressionist modern art, he recommends looking for small sculptures like those by Henry Moore, because, he says, it's easy to compare prices with similar works.
"Not everything has to be a 30-carat diamond," he says. "Five carat or two carats are good at retaining their worth."
Corbin Horn, specialist in European decorative arts at Leslie Hindman Auctioneers in Chicago, agrees. "Fine jewelry is one of the few commodities that has held value and is a reliable investment," he says. He adds that in almost any category, it's the rarest and quality that brings in the money. "The middle market has dropped out so only the top 10% is selling," Horn says.
