Investing is a popular activity in the art world, although not many people are familiar with investing in art.
Many sites exist to help people put their money into the art market for a chance of depositing fine art that will eventually pay off.
If you're thinking about diving headfirst into investing in fine art, it's vital to have a solid understanding of the Masterworks platform. Once you know a little more about art investing, you'll have no trouble making money with extravagant art pieces.
Read this complete Masterworks review to learn how to invest in art, how much money you can make, and more. Let's get started!
2021 Masterworks Review
If you're looking to invest outside of the stock market or hedge funds keep reading this Masterworks review!
What is Masterworks?
If you've ever been to a place like New York City, the chances are that you've seen a famous piece by creators such as Andy Warhol or Claude Monet. You've probably assumed these pieces are expensive – and you'd be right.
Art collectors put millions of dollars into fine works of art. Previously, this was limited to an esteemed few. Now, Masterworks aims to level the playing field with fine artwork.
Masterworks is one of the newest and best art investment platforms out there. Here, you can invest in fine art, including blue chip artwork sold in auction houses.
Today, Masterworks offerings include items such as:
- Cecily Brown
- George Condo
These, and more, are all available for those who want to start investing in art.
If you've always wanted to own a piece of a famous painting, Masterworks is the way to go. Invest in fine art through fractional investments and enjoy the Masterworks pros there to help you out along the way.
Is Masterworks Legitimate?
Masterworks is a site that deals with large sums of money and art.
If you're contemplating becoming an art investor, you may want to know if Masterworks is a legitimate place to invest in blue chip art.
In this digital age, it's all too easy to get scammed with a single wrong move performed on the internet. Is Masterworks a legitimate fine art investment platform?
Masterworks is a legitimate investing platform that takes away the minimum investment art investing always required. It's a genuine way for the average human being to participate in art investing, a hobby previously limited to those with significant funds in their bank account.
With a Masterworks account, you can have a part in an Andy Warhol piece from the safety and security of your living room. Art investing is legitimate when you do it through a place like Masterworks. All you'll need to do is go through a unique process to become a part of Masterwork's network of investors.
How Do You Become Part of Masterworks?
To become a part of Masterworks, there is a specific process you'll need to follow. It's not as simple as confirming an email since you'll be dealing with a valuable piece of art. The Masterworks team requires all users to take on a phone interview before joining, among other items.
To officially become part of Masterworks, you'll need to do the following:
- Visit the site: You should head to the official Masterworks website. There, you'll need to enter information and request an invitation.
- Take part in a phone interview: To join Masterworks, you'll need to participate in a phone interview and talk to an actual human being. There's no way around the one.
After this, if accepted, you'll be able to start investing in a painting Masterworks has made available for art investment.
The sign-up process for Masterworks stands out because you need to interview rather than take advantage of something like blockchain technology for investor verification. It can be a little inconvenient but come may appreciate the person-to-person way Masterworks approaches allowing users to become Masterworks investors.
How Does Masterworks Work?
So, how does Masterworks operate? What does it do, and how do you put money into art and start earning back on your investment? Masterworks uses several techniques and strategies to operate a system that runs like a well-oiled machine, satisfying customers and artists alike.
Keep reading to learn more about how Masterworks operates. It's essentially like a stock market that deals with a securities and exchange commission to provide art piece shares to those who are not elite. It's changing the art world, one painting at a time.
Paintings Are Purchased
First, Masterworks looks for and find paintings that they feel will work best for the site. There are a few things they consider to ensure that nothing but perfection comes through for investors.
When a Masterworks employee is searching for a piece, they will examine:
- The value momentum of the piece
- The appeal it has on an audience
- The best prices
If a piece fits these standards, it goes on to the next phase.
Once the paintings are purchased, they're not quite ready to go up on sale. There is a security step that needs to happen before this can occur.
Art is Securitized
The work is then securitized through the securities and exchange commission. This step is the last one before Masterworks can take the piece and put it on their site for all to see. They take care to capture the image well so investors know what they're investing in on the site.
Once the art is up, the investors can come in and decide which pieces they want to put their money on within the site. This action is the last step in the Masterworks system before money is made by the consumer.
Shares Are Purchased
Finally, the investor can purchase shares of the art piece. This moment is where the money is made. The painting goes into a holding period that lasts between 3-10 years. Once the painting sells, the investor earns a certain amount of money. Masterworks will take a small commission fee out of the total amount the individual investor receives at the end of everything.
If you decide that you don't want your shares anymore, you can sell them on the secondary market. From there, you can save your money or utilize it to invest in other works that Masterworks has made available to you on their site.
Is It Worth Investing in Masterworks?
Is it worth putting money into Masterworks? Will you make money, or is it just a waste of time? These are excellent questions to consider before you step further into the art investment world. After all, this is your money you're putting on these pieces.
In our Masterworks review, we discovered that you will need to make several investments in the art that sells to make Masterworks worth it. Several fees come with this system, which we'll discuss later. If you don't put your money on many paintings that sell, these fees can cut into your income and make the investment worthless.
In truth, a lot of Masterworks is skill and time. You need to be intelligent enough to put your shares on a piece that will sell and take them out when the time is right. You're going to get what you put into Masterworks.
How Long Has Masterworks Been Around?
Masterworks is a relatively new system, which some people may see as a red flag. They've been online since 2017. Although this is only four short years, in that period they have proven themselves to be worthy competitors in the world of art investment.
The prominence of Masterworks in four years is something to behold. It will be exciting to see how the company continues to grow over the years, and if they will continue to select quality pieces of art that appreciate value over time. It's a strong competitor, even against companies that have been around for much longer than they have.
What Are Some Benefits of Masterworks?
Some definite benefits come with using Masterworks. It's critical to be familiar with these if you're interested in taking part in the Masterworks sign-up process. It's one of the best alternative investment platforms out there.
Some of the biggest benefits that come with making use of Masterworks include:
- Protected and insured art that is kept in a secure location in New York City for the best results and maximum profit
- Hand-selected pieces that go through an intense evaluation process
- No minimum investments, unlike other investment companies that require a minimum investment amount from users
All of these both set Masterworks apart from other alternative investments and will benefit your overall experience.
Keep reading as we perform a Masterworks review of the benefits that come with Masterworks insights. You can compare these to the disadvantages to determine if this site is one for you, as there is a lot to consider when looking at a site like Masterworks.
The Art is Protected and Insured
With Masterworks, you don't need to worry about your artwork getting stolen or destroyed. Each piece is safe, locked up, and sealed in New York. They even have a members-only gallery that only investors signed up with Masterworks can access.
Each art piece is also protected with art insurance. Masterworks makes sure that your works of art will stay in tip-top shape until they are sold so you can make the most as the artwork appreciates. They sit in safety for up to ten years before they are sold and auctioned off.
The openness of Masterworks to reveal the safety of the paintings they have, and even show them to investors, speaks to the care they put into their system. Masterworks fees, which we will discuss later, go into adding to the defense of the paintings that Masterworks sells.
Artists Are Hand-Selected
Artists that Masterworks shares are hand-chose, picked through a precise and harsh selection system. Only around 1% of artists make it through the system and onto the site. Investors are only presented with the best of the best when they decide to put their money into Masterworks.
It's safe to say that those selecting pieces for Masterworks have great taste. Most paintings available for investors demonstrate appreciation that is above value for typical paintings. If you want to learn more, a customer representative can help make you feel more comfortable about their rigorous selection process.
Another excellent thing Masterworks does is invest in artists that are female or underrepresented. They turn away from historical trends and present valuable, non-traditional pieces that are paving the way for what is to come.
No Minimum Investment Amounts
With Masterworks, there are no minimum investment amounts. You can put a lot of money in a piece, or simply invest a fraction of what others do. The choice is yours. Masterworks operates well as a system that takes what was once reserved for those with a lot of money and turns it into a democratic system anyone can access with the right mindset.
No minimum investments mean you don't have to worry about saving up a large sum of money before owning a piece of a beautiful painting. Whether you put in ten, one-hundred, or even one-thousand dollars, there are many you can choose from through Masterworks. This unique trait sets Masterworks apart from other systems that offer the same benefits to users.
How Much Money Can You Make with Masterworks?
Masterworks can be an excellent way to grow your money. With an average return of 15% – Masterworks offers a great way to invest your money outside of the stock market.
What Are Some Disadvantages of Masterworks?
Of course, if there are advantages that come with a system, there are generally disadvantages. It's just as critical to know about these if you're thinking about Masterworks usability in your life. You can place the advantages and disadvantages side by side before you start investing to make the best choice for your life. Art sells, but is Masterworks correct for you with these cons?
Two of the disadvantages that come with Masterworks include:
- High fees
- Required phone interview
- Lacking customer service
Each of these may be a deal-breaker for an individual investor.
Below, we'll go over these disadvantages in detail. Understanding these will help make your decision easier before putting all of your money into what Masterworks offers. Keep reading to learn more about each of these. We'll also discuss the impact they may have on you within the Masterworks investing system.
Unfortunately, Masterworks charges fees on their site. The fee structure can throw this service out the window for those who don't want extra payments. If you're going to utilize this site, it's vital to be familiar with the fees Masterworks will implement on you for all of the Masterworks features and art pieces Masterworks collects over time.
Some of the fees that you may need to pay when investing in art through Masterworks include:
- A 1.5% annual management fee: This fee is charged yearly and covers items like security and insurance.
- 20% commission fee: Masterworks takes this amount from your income whenever a piece of art is sold. This high fee is almost equivalent to a hedge fund payment.
Fees can be damaging if too many are implemented on a user. A fee equivalent to a hedge fund payment can be excessive.
If you become part of Masterworks, know that Masterworks fees are a part of being a member of the Masterworks website. They help support the company and keep the works safe as they sit, safe and protected, waiting to be sold.
It's vital to know that the annual management fee will help improve your experience. It pays for the benefits, such as protection for your paintings. Although you may not want to pay it, it serves the investment company well.
Customer Service Can Be Lacking
With this site, you get an assigned person to help you through problems. Although Masterworks boasts in-person customer service rather than instant chat, some reviews claim that there is something to be desired with Masterworks customer service. Although there are two available ways to contact them – through phone and email – there are negative aspects to both.
Some of the popular complaints about customer service with Masterworks include:
- Lack of response
- Money transfers absent from investment portfolio
- Excessive calls and emails from customer service
- No representative for a scheduled phone interview
Most deal with the communication of the representative with an investor or a potential investor.
Although this may not be the case every time, it's critical to keep customer service reviews in mind. If you have a problem with anything related to money, you may not get an answer as quickly as you would like. There's no guarantee if or when a representative will be available to work through an issue with you.
Necessary Phone Interview
As we talked about above, a phone interview is a necessary part of the Masterworks sign-up process. This requirement means talking to a real-life person, talking about yourself, and taking time out of your day to do so. In a busy world, not everyone has the time to do so. Also, not everyone wants to speak to a real person when, on other sites, they can sign-up entirely online.
If you prefer to make an account through blockchain technology, Masterworks may not be for you. They operate a little behind-the-times through phone interviews. However, some may enjoy the effort they make to personally reach out to every person who wants to be a part of this investment company.
A phone interview is tough, but it doesn't have to be the end of your attempt to take part in the benefits Masterworks claims. Many have had great experiences with the authentication process, so chances are high that you will too.
Is Artwork a Good Investment?
Some may not see artwork as one of the best investment opportunities out there. However, putting your money into art is one of the greatest things you can do for the long term. Artwork sells no matter what's going on in the world, and a Masterworks investor can be part of million-dollar artwork sales even from afar.
Artwork is an excellent investment because of the following:
- High return: Art tends to have a high return, and has over many years.
- Blue Chip art returns well: Blue Chip art has a strong return, which Masterworks specializes in on their site.
- Art ages like fine wine: Art ages well. The longer a painting sits, the more valuable it will be. Why not take the opportunity to invest in it through a great investment site?
Painting and other physical art withstand the test of time, no matter what's going on in the world.
If you're smart about the pieces you select, artwork is an excellent investment that will bring you income in time. Masterworks features some of the best ones and puts them up for users. Painting sells well, and Masterworks artworks are great for this purpose.
Masterworks Secondary Market
If you get tired of waiting for Masterworks to sell your painting, you can decide to sell your shares for a profit. This deal happens on the Masterworks secondary market. To work and sell through the Masterworks secondary market, you'll need to have an account with their banking partner. You can even buy shares on this platform if you know someone putting their part up for sale.
Sell shares through the Masterworks secondary market, and you'll never have to fear that you're wasting your money sitting and waiting for the piece to sell. Your cash can be right back in your pocket, ready for saving or investing in more art that you feel will fare better among Masterworks purchases.
If you want to sell shares, ensure you're positive you don't want to stick around for profit from your painting. You never know when an auction may happen. Benefits can occur quickly and unexpectedly.
Related: Best Tangible Investments
Final Thoughts on this Masterworks Review
To settle on a bottom line, Masterworks is an excellent way to invest in blue chip art without having to pay a ton of money.
With Masterworks, you can make fractional investments rather than large ones. You can even sell your shares on a secondary market, and there's no minimum investment required for users. There's so much to love about becoming a part of the Masterworks system.
Our Masterworks review reveals that this site is a reliable investment service for those who want to put their money on pieces of art.
If you're looking for alternative investments outside of the stock market or real estate, register for Masterworks below!