Minerd: ‘Down markets tend to oversell below fair value’
In an interview last week with MarketWatch, Chief Investment Officer of Guggenheim Partners, Scott Minerd joined the growing list of investors that are preparing for a bear market.
Despite a brief market rally early this week, Minerd doubled down on his outlook in an interview with CNBC at Davos. The CIO said that he believes over the next five years, fine art and real estate could outpace the stock market.
Minerd said if given the option today, with a five-year investment horizon, he personally would put $10,000 to work in fine art or real estate, instead of stocks.
The Wall Street veteran also shared some ominous thoughts on crypto, adding the market could see a more significant slide soon. Bitcoin, he added, could erase years of gains and slide back to 2020 levels.
For Minerd, $30,000 was a significant support level for bitcoin, one that has now been broken. With the Fed tightening monetary policy, there’s a lot more downside potential, with $8000 being the bottom – a 70% pullback from current levels.
With bearish views for both stocks and crypto, but a bullish outlook on art, Minerd might be onto something big. In just 2 weeks this May, the art market had sales of over $2.5 billion, collectively.
People might think that investing in fine art by the likes of Banksy and Andy Warhol is only an option for the ultra-rich.
“Art can serve as an inflation hedge” – Bloomberg
That’s right. Contemporary art prices have outperformed the S&P by 164% over the last 25 years.
Why? Because, like a fine wine, iconic artworks have gotten more valuable with time. To the savvy buyer, art is an investment, a way to grow wealth akin to stocks and bonds.
Except that art investing used to require a ton of work. Buyers had to research the hottest artists, understand the demand in the art market, sit at auctions waving that paddle around and hoping it doesn’t come to blows with an eager buyer across the aisle.
Oh, and investors had to have a lot of money to walk away with a masterpiece. But, there’s a new platform called Masterworks that lets members bypass all the tricky barriers to entry to art investing.
Masterworks founder and CEO Scott Lynn, a recognized art collector and tech entrepreneur, created the platform to simplify the process and make investing in contemporary artwork seamless for everyone.
Now it’s possible to invest in iconic artworks alongside wealthy collectors like Jeff Bezos and Peggy Guggenheim.
Not only has contemporary art outperformed stocks over two folds, but it’s also experienced way less volatility than the stock market since 1995. And yet, it’s been completely overlooked because everyday investors have traditionally been shut out of this world by gatekeepers and complex processes.
How it (master)works
Masterworks helps you bypass the hard parts of art collecting.
As one of the top buyers in the art market, Masterworks’ research team understands all the trends, returns and players in the market so you don’t have to.
It’s purchased more than $500 million in paintings to date, and it lets people invest in shares of paintings offered on its platform, which are filed with the SEC.
Here’s how it works:
- The Masterworks research team watches the art markets to discover which types of works are going up in value.
- Then its acquisition team purchase a piece and offer shares to members.
- You select shares to invest, and Masterworks uses its proprietary data to help you tailor your portfolio based on your financial goals.
- You can earn money by selling your shares to other Masterworks users, or hold onto them and earn your share of potential proceeds when Masterworks sells the piece.
Get ahead of the curve and invest in this exciting asset class by signing up today.