I Watched A Live Art Auction For The First Time And Have One Thing To Say: I'm Doing Life Wrong

Art has become increasingly interesting to me lately. Not because I really understand it or fully appreciate it, because I don't, but I've been wanting to wrap my mind around how this asset class works as an investment.

I recently dabbled in this market by purchasing shares of Mark Rothko Untitled (1968). This left me feeling the need to embrace the lifestyle of being an art collector and attend Christie's 20th/21st Century: London Evening Sale.

Except I didn't take the PJ into the London Luton Airport like the actual participants in the auction. I sat in my worn office chair to watch the live stream on YouTube.

The auction started off with Jadé Fadojutimi’s Acquainted Intruder (2008) with an estimated value of GBP 500,000 on the high end. The auctioneer opened the bidding at GBP 240,000, and just one minute later, the bidding surpassed the estimated value with a GBP 550,000 bid.

Just as it seemed like that was going to be the last bid, a quick battle brought the price up to GBP 750,000, where it closed less than two minutes later.

A couple of lots later, Flora Yikhnovich’s Tu vas me faire rougir (You’re going to make me blush) (2017) surpassed its GBP 350,000 valuation, reaching GBP 850,000 in a matter of seconds before finally closing at GBP 1.55 million.

I suddenly found myself leaning forward in my chair, getting more excited about this auction than I expected. These paintings that the vast majority of the world has never heard of skyrocketed in value in seconds.

It was at this point that the whole concept of investing in fine art finally made sense to me. The fact is, people want fine art, and they’re willing to pay far higher than the estimated value to get it.

The auction estimates mean nothing to the buyer and there’s no analysis that goes into what they’re willing to pay for it. It basically comes down to two things:

• How many other people want it?
• How badly do they want to be the one to get it?

The idea of art is as simple as the idea of currency; it’s valuable because somebody else wants it and that value changes based on what somebody will give to have it.

If art was a new asset class, I would probably be more worried about how long this type of market activity could last, but that’s not the case at all. Fine art has been seen as a valuable treasure for centuries and interest is continuing to grow.

The art world continues to embrace new artists, styles and even completely fresh forms of art. In fact, the auction featured Woman #5672 from the World of Women (WoW) NFT series. The piece of digital art started with an opening bid of GBP 240,000 and hurried up to its closing bid of GBP 450,000.

Most people outside the art world would have probably gotten bored watching this auction, but the fact that over $330 million changed hands during Christie’s March 1 auction speaks volumes to the significance of this market and what this asset class could mean for retail investors that choose to expand their portfolios outside of traditional investments.

See also: How to Invest in Artwork

Image: Jadé Fadojutimi Acquainted Intruder (2008) courtesy of Christie’s