The Prince of Liechtenstein and a group of investment bankers have been extremely resourceful in dealing with these art investors they are ready to buy works of art, even if there will never be a masterpiece in their living room. They came up with a special market where they sell artistic promotions, Artex MTF AG, and will introduce promotions for the sale of works of art in the first half of the year. Speaking to Bloomberg, the company’s chief executive, Yasser Benzelun Tuimi, declined to elaborate on what the artwork was, but emphasized that it was a work by one of the world’s most famous artists and the price was out of reach except for the very wealthy. “Over the past 500 years, only a very few lucky and smart people have managed to acquire works of art through this, and we are trying to bring them to a regulated, accessible and safe platform,” emphasizes Benzelun Toomey, formerly the chief executive of the UBS and BNP Paribas group. Artex thus joins the category of markets that offer fractional ownership through affordable shares or shares in valuable items, from diamonds to vintage cars. This category also includes, for example, Masterworks, as it names paintings by street artists such as Banksy, or iconic representatives of pop art such as Andy Warhol.

However, according to Benzelun Toomey, Artex will be different as it will have a stock market structure. Artworks will be listed on this private exchange through a process similar to an initial public offering, and banks will offer their clients the artwork as an investment. There will also be a secondary market where prices change in real time and brokers are willing to sell or buy. Masterworks, by contrast, holds a work of art for three to ten years before selling it and distributing the profits to shareholders. Investors have the option to sell their shares on the secondary market, but Masterworks does not guarantee that they will find willing buyers. The risk for Artex lies in the rather limited liquidity in the market, which means that it will be difficult to sell or buy shares of art without large price fluctuations. Unlike corporate stocks, which post quarterly earnings, investors will have little information to form an opinion on the value of a piece of art. Artex, however, will be a test of whether works of art can fit into portfolio investments such as stocks and bonds. Many personal investment advisors are cautious and point out that the Renaissance picture has no capital flows or dividends and is thus pure speculation.

The Prince of Liechtenstein and a group of investment bank executives developed a special market.

In addition, Artex is wary for another reason: there have been many cases of investments promoting secret documents or old wines, recently even digital works, and they turned out to be fraudulent. And, of course, the fact that art price indices have been rising for decades is no guarantee to investors that they will be able to select those particular works of art that will rise in value. For its part, Artex is trying to allay potential investors’ concerns about the value of a work of art by selecting works from only one category of well-known artists of the last five centuries, from da Vinci to Picasso. Notably, investment bank Rothschild will provide advisory services to Artex, which is licensed by the Liechtenstein Financial Services Authority.

BLOOMBERG