January 2010: January 2010 - Emotional Assets: The New Alternative Investment for Family Offices

As interest in passion investments and emotional assets by HNWIs have grown in recent years so has the emergence of investment funds focused on this unique asset class. FAWM first began studying art investment funds, collectibles and other passion investments in 2003 to fill the void of information available around such funds for wealth managers and their private clients. Today we are seeing a growing number of such funds emerging including everything from art, wine and violin funds to collectibles such as iconic entertainment memorabilia.

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January 2010: January 2010 - Art Fund Managers Face Heightened Investor Concern over Transparency

Delayed launches have been a common occurence among art investment funds during the current economic environment. The Lehman insolvency and the fundamental nature of the Madoff scandal have highlighted issues related to alternative fund structures, investment process, fund operations and risk management generally. Art fund managers should think about strengthening client communication, reporting, and transparency to ease investor worries. Those art funds best fitting the institutional definition of quality will be the ones to survive and prosper.

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January 2010: January 2010 - Family Offices Integrate Art into Wealth Management Strategy

In recognition of art collectors and investors as important client segment, a growing number of Family Offices are turning to art to deepen client relationships. Engaging families of exceptional art wealth through their passions can be of immediate and practical benefit. Wealthy individuals are moving away from an emphasis solely on investment management and toward an increased focus on using their wealth to realize what they define as a richer life. Many private clients are art lovers, own collections or actively buy and sell in the art market. They require someone who shares their passion for art and understands and appreciates the significance and pleasure of investing in art and collectibles of high value whether paintings, antiquities or precious coins.

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January 2010: January 2010 - Art as a Hedge Against Inflation

There is a growing view that the magnitude of the recent global stimulus plans could lead to a spike in inflation. Research shows that in the long run, art reveals positive results during years of above trend inflation, which initially suggests that art is able to provide some protection. Art appears to be pro-cyclical, as the best performance was recorded during periods of above-trend GDP growth. In this paper FAWM explores how the British Rail Pension Fund invested $100 million or 2.5% of its portfolio into art in the mid 1970s as a successful long term hedge against inflation.

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January 2010: January 2010 - Art Succession Planning: Mitigating Risks from Art Held in Trust

Just as trustees and executors must undertake proper due-diligence with regard to financial investments, the same holds true for art. Trust and estate practitioners would be wise to seek advice from an independent art succession planner who has no vested interests in art and can draw on the expertise from both the academic and commercial art worlds.

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