Based on an independent valuation conducted by Phillips, net investor performance for 2013 was 9.39%, net of all operating costs, management fees and performance fees. As of Dec 31, 2013 the collection was valued at $16,693,084.
The art portfolio increased 12.9% this year, by almost $2 million. This substantially outperformed the overall art market which was up a mere 2.3% according to the Mei Moses World All Art Index, and also outperformed their World Post-War & Contemporary Index which was up 10.6%.
Works held throughout the year accounted for 2/3 of performance, whilst the remaining contribution came from 6 realized works (12%) and mark-ups in new acquisitions (22%).
In terms of regional contribution, Africa & Australia bounced by a staggering 42.8%, by far the strongest performing market, thanks primarily to the realization of an El Anatsui work and the back to back acquisition of another - at a sizeable discount to its current valuation.
The Latin America portfolio was once again a strong contributor to performance, rising 27.4%.
Our biggest portfolio, the Far East, was a mixed bag. Overall the portfolio was up only 4.9%, but this masks a clear and interesting trend that has been echoed in various conversations I have had with market constituents – reduced interest and a resulting decline in prices of several of the founding members of the contemporary Chinese scene, juxtaposed by some very big price increases for artists of the younger generation. In our collection, the 3 largest % decliners are from the Far East Portfolio (Fang Lijun, Sea Hyun Lee & Li Jikai), but also 3 of the top 5 performers are from the region (He Xiangyu, Wang Xingwei & MadeIn/Xu Zhen). In dollar contribution terms, our 2 biggest mark-downs are for works by Fang Lijun and Yan Pei Ming whereas Wang Xingwei and He Xiangyu are both amongst our top 5 profit contributors, with MadeIn/Xu Zhen also performing strongly.
The Far East remains our top market exposure with 35% (down from 38% in 2012), followed by India & South-East Asia at 21% (flat), and Latin America 20% (19%). New acquisitions increased our Africa & Australia allocation from 11% in 2012 to 13% in 2013. The Middle East allocation declined from 7% to 6% and Eastern Europe increased from 4% to 5%, principally the result of a significant acquisition – Rhythm 0 by Marina Abramovic.
Acquisitions amounted to almost $2.2 million this year. Some 35% of that went to our Africa portfolio with acquisitions in Ghana, Ivory Coast and Mali. Our second largest investment was in Latin America (25%) with acquisitions in Argentina, Brazil, Columbia, Mexico and Venezuela.
There were a total of six works sold in 2013, 5 via auctions and 1 privately. Overall, sales results far exceeded our long-term return expectations by producing a combined IRR of 31%. The average gross return was 77% (range: 25-210%) and the average hold period 652 days.
Link to Factsheet - Q4 2013
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