What Can Art Collectors Learn From Museum Acquisitions?

What are museums buying at art fairs? This is invariably useful knowledge for new and established collectors alike. Museums typically buy at the low end of the market and their acquisition decisions are extremely thoughtful, molded by a complicated web of the interests of directors, curators and patrons. Due to budget constraints, they attempt to buy early on in an artist's career. When a museum acquires a work by an emerging artist, it signals a stamp of approval to the rest of the art world and frequently that artist's market will rise accordingly. Call it the "museum effect." We see this effect in exhibitions as well as acquisitions. A perfect example is Wade Guyton. Six years ago, his paintings were selling for about $20,000. Then, in 2012, he received an acclaimed solo exhibition at the Whitney. One month following the opening, this painting sold for $782,500 at Sotheby's on November 13th, 2012:

If you are curious to know more about Guyton's lucrative market, read this story from London dealer Kenny Schachter about his recent chase of an X painting.

Back to museums. Rather than allowing oneself to be caught up in market speculation, although that certainly can be an entertaining game to play, I advise my clients to collect as a museum would - buying early on in an artist's career with deliberate decisions based on social and critical value. The goal being to have acquired a Guyton at $20,000, never at $800,000. This advice is not intended to undermine a healthy concern for commercial value, which naturally is a relevant factor to most collectors spending large sums of money on artwork. However, take a look at the great art collections. The reason these collectors were able to acquire such prime examples is because they bought when no one else was buying - supply was high and demand was low. Taking advantage of those moments is when collectors will see real long-term financial returns.

For your perusal, following is a brief overview of four exceptional works that the Tate purchased at Frieze last week. Two of the acquisitions were video works - a complicated medium with low demand that has yet to develop a strong market.

Terry Adkins
Muffled Drums (from Darkwater)
2003
Bass drums, mufflers
Dimensions variable

Christina Mackie
The Dies
2008
Plywood, steel, chalk, plaster, watercolour, plastic
140 x 500 x 25cm

James Richards
Not Blacking Out, Just Turning the Lights Off
2011
Double channel video installation
Commissioned by Chisenhale Gallery

Elaine Sturtevant
Trilogy of Transgression
2004
3 channel video on 3 monitors, colour
1 minute 45 seconds, 30-minute loop