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Jake Biddington's Investing

Advice on Short-Term* Trading
in Art and Antiques

*Short-Term equals an investment holding period of 1 year or less.

Short-term investing in tangibles--like short-term trading in stocks or commodities--requires knowledge, nerve and intense focus. While not for everyone, trading fine art and antiques offers profit potential for those with an eye for beauty and a nose for value.

Buyers' Tip #1 Specialize

Select an area of interest and immerse yourself in it through viewing items, handling them (when possible), turning over tags, talking with dealers, and reading. Go to museums and galleries to learn the attributes of the finest examples of the items in your narrow field.

Familiarize yourself with the wholesale and retail markets so that you are able to compute your own bid-asked spread for an item the moment you see it. Fortified with solid preparation, you can competently seek out general sources of goods such as regional auctions, estate sales and even flea markets where bargains are to be found.

RULE: Do focused, hands-on homework.

Buyers' Tip #2 Pull the Trigger

Armed with in-depth knowledge, trust your eyes. With surprising regularity, an item in your area of expertise will appear for sale. An opportunity arises whenever a quality piece is offered for less than your internally computed bid price. When this happens, don't second-guess your judgment. Move decisively. Don't lose the trade quibbling about price. (Make it a practice to carry some cash.) Buy the item and leave--preferably with the piece in your hands.

RULE: Trust your instincts and act on them.

Buyers' Tip #3 Buy What Excites You

Acquiring an art object that appeals to you solely for its supposed resale potential is a mistake. A mediocre painting that leaves you cold will probably prompt the same response in others; don't kid yourself that it's "commercial". Use your skills and taste to find and purchase artworks and objects that merit interest.

The middle rung dealers, collectors and runners who keep the fine art and antiques markets flowing are clients with discerning eyes. As a short-term investor, these are your outlets. Tempt them.

RULE: Acquire interesting, quality items.

Sellers' Tip #4 Take It Home

If want to sell a French Barbizon School painting, take it to Paris. Fine art and antiques fetch the highest prices in the area where they were created.

This is true of antiques and indigenous crafts as well. People living with accomplished craftspeople and artisans nearby tend to understand and appreciate those skills. This broadens the buying audience--well beyond a few connoisseurs--to include a large percentage of a regional population.

Learn the location of the best market for your specialty and arrange a means of offering it for sale there. If that is not feasible, then cultivate a well-funded dealer or collector in your field.

RULE: Sell your item where it is known and valued.

Sellers' Tip #5 Don't Be Greedy

In short-term trading, it's important to differentiate a fair price from full retail price.

Visiting an elegant shop on Rodeo Drive, a generous fellow willingly pays top dollar when he treats his favorite lovely to an antique brooch. He happily pays the dealer for the chic ambiance, the fawning attention of the sales staff as well as the object. That same antique brooch, in less perfectly staged surroundings, will fetch a somewhat reduced price.

As a short-term trader, you can forget about selling at retail prices. Retail is the province of those who wait. When flipping an item, your buyer will probably be a dealer or a savvy collector rather than a retail customer. Understand that a 20% profit earned repeatedly results in a handsome compounded annual rate. Don't expect to maximize the return on a short-term trade.

RULE: Leave room for the next guy--eventually--to-make a buck.

If these ground rules seem daunting, then this is not your game. For the tangibles collector with a more languid mental set, a relationship with a skilled short-term trader can be useful and symbiotic providing liquidity for the trader and offering a stream of value-priced acquisition opportunities for the long term investor.

MORE Jake:
Appraisals and Valuations
Jake Biddington's Vetted Antiques & Art Shows
Jake Biddington's Patent Numbers as a Dating Tool
Jake Biddington's Hard Assets as Portfolio Diversification
Jake Biddington's Buying Fine Jewelry at Auction
Jake Biddington's Long Term Investing
Jake Biddington's Short-Term Investing
PPP Test: Judging Quality in Contemporary Art
Art, Time and Technology
American vs. European Paintings
Jake Biddington's Art as Entertainment

Jake Biddington's BENTLEY Art & Travel Series:
New Haven, Connecticut
Visiting New York City 2005
Buenos Aires
Cultural Touring along Spain's Costa del Sol
Touring in Lisbon
Touring in Milan
Touring in Antwerp
Touring in Barcelona
I-80 Park City to New York City
Tourism New York City 2003 Update
Tourism New York City 2002
Hudson, New York (Columbia County)
Tourism Rome 2002 Update
Hartford & Wilton, Connecticut
San Francisco Jackson Square
New Hampshire Route 1A
Morris County, New Jersey

Contact Jake


Jake Biddington works on The Street and is responsible for the opinions & information in INVESTING. Young Jake, as he is known within the virtual BIDDINGTON clan, views art, antiques and collectibles as stores of value similar to stocks or foreign currencies. He sees these items as another type of asset in which to place one's money. To that end he keeps price histories and charting information on various categories of objects. He views some items as long term investments, others as items for a quick trade--and he even sees some as short sales.

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