Friday, May 17, 2013

Insider trading knowledge - the basic facts about investing in prints

By Gabriel Clark-Brown

Being a printmaker and a print dealer I have seen quite a bit what works, and simply doesn't- these past twenty years, I have seen the rise of Kentridge from humble 2 to 6 zeros, but luckily for SA printmaking Kentridge is not the only SA fine art print success story.

To understand why collectors do what they do I have written some guidelines on how to select your collection of works.

Talent, bottle it, it also comes and goes in artists lives
Talent: Talent is a rare thing in art, if you see it as a gallery you snap it up, it's a commodity that sells, and not easily faked or forced by a desperate the very best PR companies.
Very few talented artists escape the gallery system, even the illusive Fred Page was picked up and sold via a system. Some artists are not talented, but have a charismatic lifestyle that assists selling their work (as part of their character spin off), and vice versa- some artists are awfully dull, but produce good work. Sometimes you do get a highly unusual mix of talented and extraverted artists such as Walter Battiss. Either way with most artists' talent comes and goes, or you want to purchase work from the artists most talented and mature period of the artists' life.

Artist's careers: there is no sure thing in any artist's careers; people make the common mistake that artists produce the same consistent brilliance throughout their careers. Some works done in inspired years are amazing compared to money hatchet jobs that may come later.

Buy low sell high, better still buy the artists strongest works

Very few artists produce a consistently brilliant body of work. A good collector can stand back and see through the potboilers, and stuff that was rushed on a bad hair day, and focus on a few pieces of strong, iconic work. The strong iconic signature style pieces or turning points are what are reaching the best prices on auction now.
Example 1: William Kentridges Orchards were produced in the 1980's, there would fetch a great deal more that his nose series (1500+ were printed almost as collectable toys that follow a Disney movie blockbuster).
Example 2: Don't buy 12x poorly Irma Stern's at a Million each, rather buy 2 x strong works for 6M each.

Prints allow you to spread your assets.
Instead of blowing 100K on one Ernst de Jong painting I would recommend spending the same amount on 12 good prints by good, solid SA Artists. Your returns of over 10%-20% pa on the better investments would give you greater yields on your investments in the long run.

Make friends with you Print Dealer and Print Publisher.
The biggest secret in collecting contemporary prints is to call up your print publisher and ask them which print series are selling the quickest over the past 2-3 months. Generally because the print sells there is a demand for the print (Not all print editions move). Even more when the print series sells out, this is the time that prices start to rocket, as the print moves from a controlled set price market to a stock market floor retail market model -and both scarcity and demand value jack up the prices even more.
The ultimate prize is to follow the shooting star of these sales of prints in the edition until the last 10 of the edition are available that you buy for a knockdown price (the initial edition is usually sold off buy the publisher). Once you have bought these 10 you are in business and this is the perfect time to mature your investment by holding onto the prints for 2-3 years before selling them on.

Example 1 A friend of mine bought 5 x Robert Hodgins from me that were selling in their edition for R 3 000 each, he beat me down to R 2400 each if he took all 5. 3 years later post Robert's death the prints now retail for R 8 500, each, and because he bust me down as a young dealer, to R 2400 he tripled his profit.
Example 2 When Mark Attwood released Sam Nhlengethwa Tribute series they all retailed for R 6 500. The Tribute to Kentridge sold out within 2 months, hence that print shot up in retail value. Almost a year to the day a woman paid R 18 500 that I had kept back, without blinking.

General Questions

Fine Art Prints are not reproductions
Fine Art Prints are usually first generation prints printed off from a "Matrix" (current hip word) the Matrix is the medium that holds the information of the prints such as an etching plate, stone/ plate litho plate or even a PDF file.
Reproductions of work were big in the 60-80 with Swchickerts making big impressions and selling them on to a rising white middle class, Treckikoff to make it big, but no-one made it as big as Hogarth, the grand daddy of artwork/ paint reproduction who steel faced his plate engravings reproductions of his oil paintings.

Edition numbers - don't matter bar the medium
Edition numbers of works do, and don't matter depending on the circumstance.

Low editions are good, except for "Fast selling Bingo Prints"
Most artists like to keep their editions low, as they think that they can get more money through the exclusivity of the print. In addition to this the low edition number keeps the production of the print lower as less revenue is put out for the editing of the print (this is more the case of poor, younger artists).
The problem here is that no -one knows - when the print is made- if the print will sell or not. If that print is the 10% Dream Bingo print that sells out in days, the artist will never realise a good profit on the print- as it goes quickly from the artist price, straight to a secondary market.
If the artist had printed 20 Bingo prints they would have benefitted more (unless the artists hold back on some of their prints for investment purposes)

Edition numbers do matter when
1. You print more than 1000 in an edition or so, when you are dealing with a small South African market. The usual edition run generally would be between 12 to 50 or so.
2. If the matrix, say soft zinc plate is used, the quality of the print will deteriorate after 20 or so impressions, especially if there are fine lines.

Things you don't want to say in professional print dealers circle.

1. Printmaking as a democratic medium
2. Prints are accessible artwork
3. The way to price prints is the division of the main image divided by edition number

Prints as a democratic medium
This is a term that came about in the mid 1980's; I think it came about because democracy was on everyone's mind. There is no real relationship between democracy and printmaking, maybe Printmaking as a way to get your revolutionary ideas across would have been a better, more hip way of describing print making.

Prints are an accessible art medium
Fine Art Prints are not cheap, not to make, or to market, or to buy. If you were a photographer you would cringe at someone saying that postcards and photographs are the same thing, the same thing goes. Of course there would always be printmakers who whack things out for wedding invitations, or painters who create cheap scrubbers, but these works don't apply to good quality fine art printmakers. If you consider handmade wrapping paper and wedding invites as accessible art, then its best to stick with that and discern the difference to quality fine art prints.

You can't divide the total cost of image into edition
Some people try to price a print according the the image could fetch if it were say a painting. An example could be say if a Madonna and Child images was a painting it would reach say R 25 000, and one printed 25 prints and sold them on for R 1000, this would be the right thing to do.
This formula might be a guide, but simply can't work, it's like if you chop up the image and sell the image off for R 1000 per square 10cm

Example: Kentridges Orchard Print sells for R 600 000, does this mean that image of the combined edition should be multiplied by 50 - this is not fitting to the consistence of Kentridge prices.

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