Prices and value

The price of a work is made up of the labour involved, the materials, the artist's stage of career, demand and provenance (documented ownership history). With paintings, a simple rule of thumb is often used as well: a price proportional to the area of the canvas. None of those numbers stands on its own, though — they are held up by demand and by the story that belongs to the work.

Provenance is the documented ownership history of a work: where it has been and who has owned it. When a work comes from a famous collection, its price rises noticeably, because you are buying the story and the certainty of authenticity along with it. A documented origin therefore weighs as much on the market as the canvas itself.

I hold to four guides: innovation, an informed grasp of history, the relevance of the subject, and the artist's fidelity to their own purpose. When a work stands up to all four, there is a good chance it will stand up over time too. Quality and the current price are not the same thing — which is precisely why it pays to be able to tell them apart.

For top so-called blue chip art, over the long term it does: the Artprice 100 index, which tracks the strongest names, beats even the American S&P 500 stock index. That does not hold for every work, though — the market average and an individual purchase are two different worlds. Treat art as a complement to a portfolio, not as a sure bet.