Put your money where your heART is

Financial institutions are looking into the fact that 'whatever goes up has to come down'. With the Indian equity markets on a bull ride and marketmen saying that markets are overheated, there might be some instances of correction.

So how does one diversify his/her investor portfolio against the risk of correction or even a crash? The simple answer is, getting one's portfolio diversified by investing in art, which is seeing a boom both globally and domestically. 

And why will financial institutions be left behind from this boom. We see the like of it, when Bajaj Capital, a company which was into debt mobilisation, merchant banking and distribution of financial products, looking at art as an investment opportunity. The company is targetting high networth individuals, HNIs.

With the art industry in India growing at 35% per year and it being considered a safe haven by HNIs and NRIs even in times of an economic depression, experts say that the supply side has matured with time in terms of galleries and artists. Investors are getting attracted to art investment after witnessing the beef-up in retuns.

The total size of the domestic art market is estimated to be around Rs 1,000 crore. Currently, there are a few art funds in India. Copal Art, a New Delhi-based art fund, came out with two funds of Rs 10 crore each and aims to raise Rs 150 crore. Crayon Capital, an asset management company, plans to raise Rs 40 crore from its art fund. Yatra Art Fund which is launching its second art fund plans to mop up Rs 75-100 crore as compared with its first scheme that raised Rs 11 crore. The second fund will focus on the works of established contemporary artists. 

Osian's Art Fund, promoted by auction house Osian's Connoisseurs of Art Pvt Ltd,  is another such fund. The NAV figure of its Scheme Contemporary 1 as on November 9, 2006 is Rs 112.02 with an annualised rate of return at 36% per annum.

The concept of an art fund in new is to India. The concept behind this is to get investors to put in their money and buy artwork and based on their growing market value, investors can reap the interests.