Masterworks is an innovative alternative investment platform that provides the opportunity to buy fractional shares in renowned pieces of fine art. This approach democratizes access to art investments, enabling individuals to invest in works by prominent artists like Banksy and Basquiat without purchasing the entire piece.
The Wall Street Journal reports that the fine art sector has seen an average annual return of 10.6%. With a minimum investment of just $20, Masterworks also offers a secondary market for those looking to sell or acquire additional shares before an artwork’s sale.
In short, Masterworks allows you to become a collector and shareholder of museum-worthy art. You get all the benefits of ownership, like potential price appreciation over time, without the hassle of buying, selling or maintaining the physical work. Here is a Masterworks review explaining why you should sign up for Masterworks today.
Learn More About Masterworks
How It Works
Masterworks has an expert team analyzes the contemporary art market to identify artworks poised to gain value. Once they secure a promising piece, they legally file it with the SEC, allowing it to be divided into shares for investors.
To get started, you request an invitation on their website. After providing information about yourself, they’ll suggest artworks tailored to your investment goals and risk tolerance. You choose how much you want to invest in each piece.
Masterworks handles all aspects of acquiring, insuring and selling the art. They have a private sales team to get the best price when it’s time to sell. After the sale, profits (minus fees) are distributed to shareholders. There are some limits, though no single investor can own more than 10% of any artwork, and you must hold shares for at least 90 days before selling on their secondary market.
Masterworks features several aspects that set it apart as an excellent art investment platform.
- Curated Art Selection: Masterworks partners with renowned art experts to source and curate a selection of investment-grade contemporary art. They often feature famous paintings and art pieces by Jean-Michel Basquiat, Joan Mitchell, Picasso, Banksy, and other highly sought-after artists.
- Data and Research: Users get access to very good research resources on the fine art market and industry, including a contemporary art prices database that tracks thousands of pieces of artwork.
- Customer Service: Great customer service is hard to come by these days. Masterworks offers customer support via phone and email to help guide new investors and address any questions existing users may have about the platform or a specific artwork.
- User-Friendly Platform: Masterworks has invested in creating an intuitive user interface and platform that caters to new and seasoned art investors. The platform is easy to navigate and use regardless of your experience level.
- High Growth Potential: Surprisingly, artwork has historically produced higher returns than stocks, bonds, mutual funds, and real estate. The contemporary art market has outpaced the S&P 500 over the past 25 years.
- Mobile App: The iOS and Android app allows you to monitor your portfolio and see real-time updates on your shares’ values and the overall art market. You can also view details on individual artworks, including images, provenance, and historical pricing data.
- Educational Resources: Masterworks provides resources to help you understand the fine art market. Their blog features insights from industry experts on topics like specific artists, trends in the art world, and strategies for building an art investment portfolio.
- Community and Social Engagement: Masterworks maintains an active social media presence on platforms like Facebook, Instagram, Twitter, and LinkedIn. Following them on social media is a great way to stay up-to-date with Masterworks news and connect with other art investors.
Masterworks Pricing & Fees
Masterworks charges two main fees to cover the costs of managing and selling artwork.
Annual Management Fee
Masterworks charge a 1.5% annual management fee based on the total value of your account. This fee is deducted from your equity annually, diluting your shares. There is no option to pay this fee with cash. The annual management fee covers operating costs like managing the artwork, storage, appraisals, insurance, and SEC regulatory fees.
When Masterworks sells a piece of artwork on the open market, they take a 20% cut of the total sale price. This means if a piece of art sells for $1 million, Masterworks would keep $200,000 as their sale fee. The remaining $800,000 would be distributed to shareholders based on the number of shares they own.
Final Verdict: Should You Sign Up For Masterworks?
Masterworks offers an exciting new way to invest in fine art, an asset class that has proven to provide solid returns over time. The platform gives you access to multimillion-dollar works of art for a fraction of the cost. Experts manage your investment, so you don’t need to know much about the art world to participate.
If you’re an investor looking to put your money to work in new ways, Masterworks offers an innovative platform to access the fine art market. Investing in world-famous works of art for a fraction of the cost, with all the logistics handled by experts, is appealing.
While returns are not promised, the fine art asset class has proven itself over the long run. For most investors, putting a small portion of your portfolio into alternative investments like this can be a smart diversification strategy. Click here to sign up for Masterworks today.
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