Javier Lumbreras

A Contrarian Perspective on Investing in Beautiful Assets
By Javier Lumbreras



GUIDING PHILOSOPHY.

“Buy what you like and never mind the price.” Or, put another way: “If you buy what you like, you will never be sorry”.

That is the advice regularly dispensed to novice and connoisseur alike by galleries and auction houses. There is some value in this, of course. You want to enjoy the art that you purchase. But you also buy with the hope that it will appreciate in value and provide a good return for your investment. While we have many dear friends in galleries and the auction houses, theirs is a philosophy we do not ascribe to. The Artemundi Global Fund has as its mission providing a significant return for your investment. We never let infatuation with an artist or painting or school get in the way of this thinking. It is always foremost in our minds.

A CONTRARIAN PERPSECTIVE.

As with so much in life and in matters of the mind, heart and money, Timing is Everything. Clearly, it would not have been good timing to start an art fund in the recent past, prior to the economic malaise now facing much of the world. A year or so ago, the price of quality art was rising at an unsustainable level. Speculators and the extremely wealthy drove the prices of Old Masters, blue chip Impressionist and Modern Art sales which is why an unusual percentage of lots sold, many well over the estimates, and the auction rule of thumb that for every five lots, one does not sell, one sells against the reserve, two sell within the estimate and one sells above it – became all but irrelevant. In short, until quite recently, opportunities to purchase fine works of art at sensible levels were few and far between.
THE ENJOYMENT OF ART.

All that has changed. Suddenly. Dramatically. Yet despite the downturn in the cost of art works, it is a paltry setback when compared to what has transpired in the real estate and stock markets. As you can see in some of the attached articles, fine art has retained much of its value. But this is not unexpected. Masterworks have always appreciated in value, generation after generation. And that is what our fund is all about: acquiring fine work by notable artists and holding on to them until a well-thought-out ‘Exit Strategy’ kicks in.

Our goal is to find collectors who share our philosophy, participating in a small closed-end fund that is not merely a tool to greater riches, but also an investment that rewards in so many other ways, bringing intellectual and social enrichment, along with an enhanced sense of self-affirmation. Even beyond that, we are able to provide what we believe is a first in Art Funds. Investors will have the opportunity, on a revolving basis, to display the Fund’s artwork in their homes or offices. This is all but unheard of in the investment industry. We also plan to provide investors with the opportunity to learn more about the art of collecting and the art in their fund, through lectures, monographs, and our own insights acquired over the years.
QUALITY ALWAYS SELLS.
One benefit to the restructuring of prices in the art market: Speculators have disappeared. The serious investor in art today also tends to be a serious art lover, whose aesthetic appreciation and emotional response to fine art is not diminished in any way by a perceived loss in value. The exit of the speculators from the market only means that the serious collectors will have the opportunity to improve their collections at a fair price.
Historically “down times” are bad times to sell art and good times to buy it. Peggy Guggenheim put together one of the great collections just as Germany was poised to invade France in 1940. Everybody, including the artists, wanted to get out of Paris -- except Peggy, who toured the studios, picking up bargains. She needed to do that, because she was one of the “poor Guggenheims.'' Her father Benjamin lost most of his fortune in bad investments and died when the Titanic sank in 1912.
The one belief we hold to strongly to is that quality sells. Buy the right art at the right price at the right time and you can be assured of getting the return you have in mind. That is the philosophy that guides us in the Artemundi Global Fund and why we are so excited about its prospects.