Investing in Art or Investing in Bonds?

Art is design of good-looking or important things that you express them with drawings, paintings, photographs or even skits. Art is done by a person who creates art as a career. Bonds are official document of arrears issued by the government for you to raise money; more like investing in the future. It’s more like an IOU; the corporation that gives the bonds is known as the issuers, while the one that buys it is known as the investor (What are bonds… 1). Investing in art and investing in bonds is not the same, but its still investing on something; you want to make money. Investment is paying a certain amount of money (your choice) that will develop with time. Your money can multiple if you leave it for a long period of time that is long term investment (Marabella 1).This paper will discuss investing in art and bonds. There will be clear definitions of what art is and what bonds are. Then will later on compare and contrast the pros and cons of those two types of investments.

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Is art a worth it investment? Art is already an advantage by itself. Unlike any other investments, art is one that you can enjoy will looking at and touching it. When investing, it has a time for disappointment and a time to be happy; their different seasons. Investing in art can provide a good diverse plan, as long as you have a put up groundwork of your collection. It is also a business; do not forget about the supply and demand, which will affect the pricing. Also investing with the right artist or artwork at a good time, it will bring out positive and great returns (Is art….1).

How exactly do you invest in art? To invest in good art, you need to take great care of where you get you art from. You need to visit art galleries with original artworks, get books or magazines talking of the art world, invest in artworks that you actually enjoy and you should buy art when you know very well the type/painter/average price and genuineness (Torabi 1). Is it a good idea for people to invest in art? It is best if we accomplish our “foundation goals” than rushing into the “lifestyle goals”, which might not be too late. If you get the fundamentals in your collection right, then you’re free to go forward into the art investment. The most important principle in investing in art is to buy what you know; understanding what you are buying will be helpful in such investments. Reasonable investors usually know that it is best to know very well the understanding of the company products, markets, supervision and investments. Same applies to buying art. If you are buying a painting it is best to know who the artist is, is the artist famous, where the artist did his/her schooling, is his work still in fashion or out of fashion, is the artist still alive or dead? Those are the different questions you should ask your self before jumping into major conclusions (McKenna par. 6).

Are bonds worth to invest in? Bonds are official documents of arrears issued by the government to raise money. When you get to the point that you want to invest in bonds, you need to know of what type of bonds to invest in. Most people make a mistake of involving themselves in bonds their tax situations can’t handle; municipal, government, corporate and international bonds are the once you can choose from according to your risk tolerance. Municipal bonds are given by either a city or local government; potential users for these specific bonds are cities, countries, school districts or even seaports. The main purposes to raise the money are to help build roads, schools, highways, hospitals and other extraordinary developments. Government bond is given by government and in a countries own currency. If a bond has been given by a national government and is in a foreign currency, then it is called the sovereign bond. Corporate bonds are normally given by corporations to help raise money to help expand their businesses. International bonds are given in a country by a non-domestic individual. If you need to have risk tolerance, what is the point of you investing in goals? Bonds are important because you preserve your capital investment, especially retired people. Not only does it increase retirement income, but you can also save for your children’s education or even a new house. Your objectives can be achieved if you at least try to invest in bonds. Bonds are a significant section of the expanded selection (Gekko 1).

For all the art lovers, investing in art is a great way of making a little money from what they love best, but it also has its disadvantages. The advantages could be profitable, but you will not be laughing if you loss all your money in some bond investment. People usually rush to do things just for the money. “Before you jump in with both feet and your family’s nest eggs,” you should at least make sure all your facts are well weighed. Art investment is a bit difficult to buy or sell, because you just cannot sign into a website and call a broker; without some one to buy your art, it might take long before it is bought. The best thing about art works are unless the piece is ruined of damaged, it is still a precious thing in your collection (The Pros and…. 1).

Bonds go up and down more than stocks. Their prices actually fluctuate less. If you get the correct type of bond, it can provide a comfortable level of income steadiness. In the past, it was said that bonds have lesser long-lasting returns than stocks. The long-lasting bonds experience cost fluctuations because the interest rates are going up and down (Develop an…. 1). As an advantage, did you know that bonds are safer than stocks? Remember the meaning of bonds; bonds are debt securities. Buying a bond is lending money to someone who will eventually return it with a certain amount of interest. Disadvantages of bonds will depend of the borrower’s ability to pay back; if the money cannot be refunded, then it is a failure to pay (Ninomiya 1). The biggest reason is that it is a very safe investment, especially from big cooperation or government. The disadvantage of investing in bonds is that though safe, you do not get a big return on them.

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In conclusion, as I had mentioned earlier in my paper, investing in art can be tricky if you do not know what exactly you are doing. This venture involves good knowledge of what where and how to go about the investment. Investing in art and investing in bonds are two ways to have quicker access to money. Personally, I think I would settle for investing in bonds, because investing in art can be a little bit hectic especially when you get a raw deal or, when you do not sell your paintings, drawings or sculpture at higher price so that you get some profit. This is to say, investing in art makes one runs higher chances of running into a loss as compared to investing in bonds. However, for people who prefer investing in art consider it being financially secure. This is because they are not dependant on the state of economy and economical variables. After the recession, people who invested in bonds lost a lot of money, while those who invested in art had fixed movable assets. In the recent years, the interest in art has increased. It is funny how the bonds get more preference yet they do not get a big return. Yet, investing in art can be relatively not too safe but the returns are far much better. However, art is more demanding in comparison. We come to find out that all the things that we rush to do have advantages and disadvantages, but most people only look at the advantages and forget about the disadvantages. As I was doing the paper, I came to realize that most dependent countries might prefer investing in art than in bonds. They know that investing in art you get a better percentage in the pay than in bonds, but what they don’t realize is that investing in art is not as safe as investing in bonds. When investing in bonds, you need to be one patient human being. Bonds need time to mature because without that you will get an amount that is far much less than what you expected.

Work Cited

Develop an Investing Strategy. AmericanFunds. 2010. Web.

Is art a good investment? Reuters. 2007. Web.

Marabella, Magaret. Investing: The Art of Making Your Money Work For You. 2006. Web.

Mckenna, Timothy. The Art in Investing in Art. CultureInside. n.d. 2010. Web.

Ninomiya, Kent. Advantages and Disadvantages of Bonds. eHow. 2010. Web.

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The Pros and Cons of Art Investing. 2007. Web.

Torabi, Farnoosh. Investing for Art Lovers. TheStreet.com. 2007. Web.

What Are Bonds and How Do They Work? AllBusiness. 2010. Web.

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