Manager Update - Q3 2013


Dear Friends,

This quarter was marked by 3 distinct periods. July was focused on the summer auctions in which we stepped up our activity on the realization front. August was a quiet time for administrative work and for recharging. September marked the beginning of the new season with extensive research trips to Moscow, Berlin and London. We also received interesting coverage this quarter in the form of a video hangout organized by Skate’s, comparing our model to that of other art funds. Furthermore, in our continued effort to create a standard of transparency for the art fund industry, we are proud to announce 2 new milestones: the launch of our Quarterly factsheets and our Bloomberg listing.

Visit at Garage Center in Moscow

We realized 4 works in July, 3 at auction and 1 privately, for a total of $ 1.23 million. With a cumulative cost just shy of $ 0.7 million, profit was over half a million USD, a 77% gross return and a 28.5% gross IRR. Our biggest sale was of work by Ghanian artist El Anatsui which sold at the Christie’s London evening sale on June 25 for GBP 580’000 hammer. Concurrently we acquired another work by El Anatsui of similar quality and stature. We also sold a major photographic work from the collection in a private transaction, and shortly after acquired another edition of the same work at a substantial discount to our selling price, a true arbitrage.

In addition to taking some time off with the families, August was focused on administrative matters and development of new marketing collateral, which I briefly introduce below:

Quarterly Factsheet: From now on, in addition to our regular newsletters we will publish a quarterly fund factsheet which will be available on our website. The purpose of the factsheet is to provide a snapshot for existing and potential investors about the fund’s objectives, quarterly update, historic returns, as well as extensive statistics on exposures, correlation, volatility, Sharpe ratios and artwork realizations. All in a format that is familiar to financial investors and which furthers our efforts to provide transparency and create a vehicle that bridges the knowledge gaps between financial investors and the art world. Link to Q3 Factsheet
In similar vein, we have listed the fund on Bloomberg. Our ticker is: ARTVANT:TL
Website: Based on user feedback we implemented several cosmetic changes and are working on a number of additional features that we expect to implemented shortly.
Logistics: We renewed our insurance policies and have undertaken a detailed review of our storage facilities in order to gain further efficiencies.

In September I travelled to Moscow (Art Fair & Biennial), Berlin (ABC, gallery weekend) and London (Serpentine events, gallery viewings and meetings). As a result, I am currently completing research and negotiating the acquisition of several new works primarily for the Russia & Eastern Europe, Far East and Latin America Collections.

We will remain underweight Russia as the trip proved yet again that the market there for contemporary local art is still very weak, with most collectors focusing on international artists or Russian modern art. That said, privately funded initiatives including several new exhibition spaces, galleries run by younger dealers, new archives and wide-scale educational programs suggest forthcoming interest by a younger generation of collectors.  The Biennial in Moscow was well curated and beautifully installed, bringing a few new artists to my attention. 

Berlin proved a very worthwhile visit. The format of ABC Berlin – somewhere between the well known Statements format and a regular art fair, was truly refreshing with a few excellent presentations by local and international galleries/artists. Furthermore, I spent a good amount of time with each of the galleries we have already worked with in Berlin in the past couple of years to review their programs and get updates on some of our existing artists. 

 Zhao Zhao throne at the 'Game of Thrones' exhibitionIn Front of the Zhao Zhao throne at the 'Game of Thrones' exhibition in Museum für Asiatische Kunst, Berlin

In London I attended the opening of the new Sackler wing of the Serpentine Gallery, with a powerful presentation by Adrian Villar Rojas, who worked on site for the past 3 months with a crew of 9 to create another totally immersive experience of grand dimensions, once again demonstrating this young artist’s incredible talent, creativity and motivation. The exhibition was a direct extension of the installation he made in 2008 at the Ruth Benzacar Gallery in Buenos Aires, from which the collection acquired the 2 central works. I also made progress on 2 exhibition initiatives that are likely to take place in Q2 2014 in London, more on these in the next newsletter. I also attended a few gallery openings for artists I have been following for some time, and am negotiating a few works as a result. 

AVR inauguration of Sackler Wing @ SerpentineAdrian Villar Rojas inauguration of Sackler Wing @ Serpentine Gallery

September also marked the first time that a foreign auction house has succeeded in penetrating the world's second-largest market, China. Christie's first auction featured 43 lots comprising wine, watches, jewellery, Asian contemporary art, and several well-known Western Modern works. Forty lots were offered realizing a little over €20 million including premium – a promising result.

Q4 will again be busy with planned trips to London for Frieze, Paris for FIAC, New York for the November sales, Mexico with the Serpentine followed by Miami for Art Basel, and perhaps Istanbul to view the Biennial there before it closes. I hope to see you somewhere on the circuit and as always welcome any feedback you may have. 

Best wishes,
Serge Tiroche


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