In this article, we investigate attractiveness of the fine art market for investors in several ways. First, we construct hedonic art price indexes using the time dummy variable method based on the quantile regression. Secondly, we assess the art assets risk through CAPM model. Data include 536660 observations about oil paintings on auctions around the world during 2005–2015. According to the estimation results, the postwar paintings sold in the high price sector could be considered as an attractive sector for the investors but its acquisition is accompanied by a relatively high risk compared to the operation on the stock market.

The paper presents art as a special object of investment. The features of works of art and art market are presented in comparison with characteristics of securities and stock exchange market. The author takes into account the following criteria: commodity features, ownership characteristic, markets’ classification, liquidity, access to information on prices (market values), kinds of values, incomes, time horizon of investment, market indexes used for art market and stock exchange indexes. The paper takes up the issue of the most important characteristic connected with any type of investment i.e. risk and rates of return. The author presents different kinds of risks related to art investment.

This chapter takes a close look at the financial implications of including art as an alternative asset class. Faced with under-performing portfolios, investors are continually seeking alternative assets and sophisticated solutions to reap high returns while minimizing risk. This previously nontransparent market is becoming more accessible via the increasing availability of indices and data on the art market. Additionally, art funds offer investors the opportunity to invest indirectly into the art market. Indirect investment into the art market results in losing the aesthetic pleasure from holding the art; however, financial gains can be made through pooling resources with the help of experts while gaining from diversification benefits.

For centuries, wealthy individuals and institutions have collected and consumed art for aesthetic pleasure. While anecdotal evidence suggests that some artworks have appreciated in value over time, few studies have documented investment returns in art systematically. This paper demonstrates that art could be an important asset class in many respects, worthy of addition to the long-term investment portfolios of individuals and institutions. Because individual works of art are not securitized, studying the value of works of art from financial sources is not possible. Gallery or direct-from-artists prices tend not to be reliable or easily obtainable. Auction prices, however, are reliable and publicly available. As a result, auction prices can be used as the basis for a database for determining the change in value of art objects over various holding periods.

In conditions of the stock market instability the art assets could be considered as an attractive investment. However, due to the heterogeneity of the fine art market's goods and the absence of the systematic information about the sales, researchers do not come to the same opinion about the merits of the art assets conducting studies on single segments of the market. This paper investigates the attractiveness of the fine art market for investors. Extensive data was collected to obtain a complete pattern of the market analyzing it within different segments. It constructs hedonic art price indexes using parametric and semi-parametric methodologies and assess the risk via CAPM model. The artworks in the high price sector are the potentially most profitable assets on the market, but the investments in paintings are associated with high risk.

This study considers whether investing in a fine art at the correct price could diversify a portfolio risk and stabilize the volatility of one's portfolio and position one's art collection for upside appreciation. Since investment in art is modeled with due regard to the peculiarities of artistic work and value created activities, it follows that the construction of earnings functions and models of career choice in this area will also need to account for the risk and return function.

The paper develops and tests a set of research hypotheses about the effects of model characteristics on market values in the context of a generalized hedonic price model that also accounts for heterogeneity among classic car brands. It is demonstrated that classic car model values reside at several levels and are determined by observable characteristics pertaining to aesthetics, rarity, engineering and performance. In addition, we show that classic car marques play a critical role in the determination of model values and account for considerable variation in values, even after controlling for observable model attributes

The article presents the specificity of passion investments as a kind of alternative investments. In particular, investments in collectible cars are discussed: the characteristics of potentially collectible cars, as well as basic indices for the collectible car market. Presented comparison between Hagerty indices and the New York Stock Exchange indices (Dow Jones and S&P500) between January 2006 and March 2016 indicates a higher return on investment in the collectible cars. With an exception of the 2008–2009 recession, investments in collectible cars allowed to achieve a higher rate of return compared to gold, too. However, further analysis shows that there are significant differences in the profitability of investments depending on the specific car model.

In this paper, the investment performance of (classic) cars and the diversification gains on diversified investment portfolios is analysed. This paper will be the first to investigate the portfolio diversification gains for the (classic) car market. The study is based on a dataset comprising more than 25.000 cars built between 1947 and 2019. The data is gathered from auction results between 2002 and 2019. Multiple price indices are constructed to analyse the investment performance of (classic) cars using a hedonic pricing methodology. For the whole sample, the return between 2002 and 2019 was 1.46%, with a standard deviation (risk) of 10.08%.

An excerpt from Chapter 13 of this investment guide reads, 'Collecting cars can be a lot of fun. A great deal of money can be made, too, but at the end of the day, it is the same as with any investment: The value of classic cars can go down as well as up. However, investing in classic cars can offer much enjoyment along the way. There has been a resurgence in famous retrospective events such as the Goodwood 12/12, the Vernasca Silver Flag, and the 1000-mile Mille-Miglia, which takes place in Italy every May and that features more than 350 classic cars worth many millions of pounds battling it out.'

This paper examines the risk and returns of classic car price indices over the 1994–2021 period. We calculate the central tendency, dispersion, shape of risk and returns, the unit root tests, and correlations. The results indicate a moderated volatility, a low range of returns, and a weak expectation of financial gain given the ancillary costs related to the auction, transport, insurance, guarding, maintenance, and restoration. There are low correlations among the classic car markets. These results provide a better understanding of the risk and returns of the classic car market for many actors such as individual and professional investors, collectors, and wealth managers. Investing in a classic car is more of a passion and emotional investment than a simple desire for financial gain.

Over the past decade investing in classic cars has financially done better than many other collectibles such as stamps or coins. In this study generate data regarding the facts of investing in classic cars. Potential investors need significant knowledge about classic cars because not all old cars can be considered classics. The car is rare or available everywhere. Classic cars are depreciable assets, so it is very important for investors to know how to maintain the value of classic cars. Investing in classic cars is a little risky because to generate a reasonable return, investors must buy the vehicle and repair or maintain it before reselling it.

Investing in classic cars can be a supplement to traditional investments for private clients in wealth management. The Classic Car Banking Concept, which is presented in this paper, demonstrates the ability to integrate the investment in classic cars into an existing wealth management structure. Thereby, the further diversification of an investor's portfolio by adding classic cars offers an interesting earning potential in the current situation of historically low interest rates in many parts of the world. Moreover, Classic Car Banking as a segment of wealth management in general has the potential to use the conceivable emotional involvement of investors in order to intensify the relationship between clients and consultants.

This dissertation investigates the overall feasibility of classic cars as an alternative investment strategy as well as the price determinants of classic car values. It is the first known study from a South African perspective. A sample of 287 classic car auction sales was considered over a 15-year period between January 2005 and January 2020. A hedonic regression was utilised in order to establish the price determinants for classic cars. In addition, traditional asset returns were compared to the classic car returns. Compared to other assets, returns on classic cars remained strong.

This research chapter explores how Rolex was deeply transformed after 1990 to control production and strengthen competitiveness against the emergence of many new competitors onto the segment of luxury watches (Cartier, LVMH, Omega, etc.). First, Montres Rolex SA, in Geneva (formerly named Aegler), took over the manufacture of movements and numerous suppliers to exert control over production. This chapter discusses the sharp increase in prices of Rolex over the last three decades. It shows not only that the iconic models of this brand became more and more expensive but also more exclusive, in the context of growing income inequality.

This paper suggests that jewelry and jewelry products price can be predicted at a several year horizon. The prediction consists of three steps. First, it shows that the difference between producer price index and the index for jewelry and jewelry products is characterized by the presence of sustainable mid-term trends. Second, the evolution of the difference is predicted at a five to ten-year horizon. Considering the PPI to be practically constant over the next decade, the above difference provides a direct prediction of the price index for jewelry and jewelry products.

This paper analyzes nearly twenty federal court holdings on federal trade dress jewelry design disputes over distinctiveness, functionality and likelihood of confusion, developing a narrow, industry-specific framework for assessing the viability of litigation of trade dress cases in the jewelry industry. Then, this paper applies that framework to the fact patterns of the recent litigation between well-respected jewelry brands David Yurman and Mejuri. Finally, this paper provides guidance for jewelers of differing sizes on establishing financial success and fame, as well as developing unique designs.‍

This thesis explores how new entrants navigate disruption in the luxury market through the case of lab-grown diamonds. It examines the challenges they face and the strategies they adopt in an industry shaped by preconceptions, heritage, and incumbent resistance. Using a qualitative approach, including a systematic literature review and semi-structured interviews with founders of entrant firms and a luxury marketing expert, the study connects theory and practice to show how disruptors build competitive advantages.

Competitive dynamics between firms and buyers are shaped by mutually understood conceptual systems that enable market interactions. Third-party audiences, such as the media, play a crucial role in shaping market structure and evolution by facilitating the development of these conceptual systems. The study examines the coreness of firms within the semantic network of firm names as relayed by the media.

This paper empirically tests whether Rolex watches may be considered safe-haven assets. The study employs Local Gaussian Correlations and spectral analysis spanning from 2017 to 2023, examining the relationship between the Rolex market index and more conventional assets, namely: S&P 500, Oil, Nikkei, Eurostoxx, Gold, REIT. The results revealed that the Rolex market index, an Rolex watches, exhibited safe-haven properties during the pandemic crisis.

This study finds that luxury watches - particularly Rolex, Patek Philippe, and Audemars Piguet - yield significant diversification benefits when being added to well-diversified portfolios comprising stocks, bonds, and gold, and even outperform them on a risk-adjusted basis. All luxury watch returns exhibit remarkable low volatility most comparable with bonds while being uncorrelated with traditional asset classes.

This study examines the risk and return characteristics of luxury watch investments. The luxury watch market offers lower returns than equities but is less volatile. It outperforms fixed income and real estate, with significant performance variation across brands. Illiquidity, analogous to other collectables, is an important feature, yet luxury watches enhance portfolio diversification and reduce risk. The study contrasts the distinct features of investing in physical watches versus stocks of watch manufacturers, emphasising the importance of understanding market segmentation.

This paper explores the second-hand luxury watch market, aiming to provide a comprehensive understanding of its dynamics and implications. It explores both materialistic and psychological needs that influence purchasing decisions, along with a detailed analysis of the target audience. The paper presents a case study of Richemont's strategies in the used luxury watch market. It analyses the acquisition of Watchfinder and Enquirus, exploring the history, strategies and impact of these moves on the high-end watch industry.

The authors study consumers’ valuation of status signals by estimating their willingness to pay for a luxury item with a quiet vs. a prominent logo. The study finds that consumers are willing to pay a sizeable premium of $161–$174, or 17%–18% of the retail price, for quiet handbags as compared to loud handbags. The study suggests that counter to conventional wisdom, consumers are willing to pay more for quietly marked luxury goods that allow them to signal a more targeted group of peers with similar cultural capital or social connectedness.

In 2014, Chinese luxury market accounts for 25% of whole luxury consumption in the world, becoming the largest luxury market in the world. However, the attitudes and motivations held by Chinese consumers towards luxury products consumption are under-researched, thus becoming an important academic topic, which needs exploration. The study adopts a multiple regression analysis to explore the potential causal relationships. The conclusion is that income is a statistically significant predictor and the knowledge gap has been greatly narrowed, while education and age do not have significant effects on luxury handbags buying motivations.

The purpose of this study is twofold: expand the body of empirical knowledge of consumer luxury brand perceptions by using the Brand Luxury Index (BLI) scale to compare and contrast young female consumers’ luxury perceptions for a luxury brand and counterfeits of that brand, and use the data from the research to investigate the psychometric properties of the BLI scale.

The pre-loved luxury market, particularly for handbags, is undergoing a period of rapid growth, driven by digital platforms and attracting younger consumers. The authors identified new motivations for purchasing pre-loved luxury handbags based on a survey of 1,002 respondents. The findings of this study highlight the significant influence of pleasure and exclusivity on consumer behavior and, provide valuable guidance for brands and online platforms to effectively engage with this market.

This study examines how the handbag has developed into a highly reputable and gratifying object in the twenty-first century. It places it at the intersection of three attributes: a sociocultural accessory, a feminine hallmark and a status marker. The study sheds light on the handbag’s latest appearance as non-fungible asset in the virtual world and the problematic volatility of its monetary value.

This paper aims to examine a consumer segment, Millennial, and its status and conspicuous consumption tendencies. The current research was conducted to determine if handbags can be used as a symbolic representation of status.

The Hermès brand is synonymous with a wealthy global elite clientele and its products have maintained an enduring heritage of craftsmanship that has distinguished it among competing luxury brands in the global market. Hermès has remained a family business for generations and has successfully avoided recent acquisition attempts by luxury group LVMH. This article examines some of the allocation practices used to carefully manage the Hermès brand in the US market.

Piiroinen researches the possibility of luxury handbags being classified as an alternative investment, and calculates the appreciation rate as well the average rate of return for over 160 Hermès Birkin handbags from the Artcurial auction. Based on the secondary data research, comparison to other luxury goods that are classifies as an investment as well to the primary data research, Piiroinen concludes that luxury handbags can be viewed as an alternative investment.

“Alternative investments” generally refer to the “everything else” boxes of investments that are left out of one of the traditional boxes of stocks, bonds, and real estate purchased by “mainstream” mutual funds. Perhaps contrary to the name, many of the investments twenty-first-century advisors commonly consider “alternatives” are actually far older than the modern form of listed stocks or traded bonds. Consider the ancient history of investing in gold coins or art, private investments in shipping ventures, or Lloyd’s early insurance contracts.

Journal of Investment Strategies ISSN: 2047-1246 (online) Editor-in-chief: Ali Hirsa Impact Factor: 0.1 First Published: December 2012