What is an Art Market Index?

Art market indices are important tools to understand overall market performance and benchmark art against other investable assets. Traditional liquid assets, such as stocks, fixed income and commodities have any number of well-known indices to track performance over time: the S&P 500, the Barclays Aggregate Bond Index, WTI Crude Oil Prices, just to name a few.

But the art market presents a number of challenges to creating an index: it does not trade frequently, there is no stock-exchange-like market for art, nor is all art is fungible. This all makes creating an art index a considerable challenge!

Fortunately, a number of techniques have been developed to create an index for illiquid assets such as art. Among the more well-known is a repeat-sales index. You might have heard about the Case-Shiller Home Price Index (now owned by S&P), which tracks the appreciation of residential real estate. A very similar technique can be applied to the art market to understand performance overtime by observing the returns achieved by people who have bought and sold the same work of art at public auction. There are also other techniques that measure the performance of the art market by aggregating all the artwork that sells at auction and controlling for specific characteristics within each artwork (such as artist name, size, medium, the year it was created, and so on).


The Masterworks Index

Masterworks has developed a number of internal art market indices using a similar approach as the Case-Shiller Home Price Index, which uses repeat-sales. A repeat-sale refers to an artwork that has been sold at least twice at auction, such that an implied return between the sale dates can be calculated. We build an index by observing these returns over time, which allows us to infer the performance of the art market overall relative to other asset classes.

Masterworks’ acquisition strategy is focused on the Post-War & Contemporary category, where index returns have generally outperformed in recent decades. The Masterworks Post-War and Contemporary Index has increased 8.7% on an annualized basis over the past 20 years versus 6.0% for the S&P 500.


The Masterworks Post-War and Contemporary Index Since 1999

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Sources: Internal Masterworks analysis based on repeat sale regression (3-stage generalized least squares method). NYU Stern.
Notes: Masterworks art index data updated as of January 22, 2020.


The ArtPrice100 Index

The well-known art market data group, ArtPrice, publishes an art market index that tracks the performance of the top 100 best selling artists in any year. This index weights each artist according to its total auction sales, in a similar way that the S&P 500 is weighted to the market cap of each company in the index. 

Similarly to the Masterworks Post-War and Contemporary Art Index, the ArtPrice 100 Index has increased 8.4% on an annualized basis over the past 20 years versus 6.0% for the S&P 500.


The ArtPrice100© Index Since 1999

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Sources: ArtPrice100© Index as estimated from public available charts. Copyright ©Artprice.com. NYU Stern.



Art indices are an important tool for anyone interested in participating in the art market, especially those with an investment-oriented objective. Observing both the Masterworks and the ArtPrice100 index, we notice that the art market appears to outpace inflation and, in some periods, can outperform financial assets, including the S&P 500. There are a number of drivers behind this, including how supply and demand are created in the art market, as well as the fact that art is a mobile, real (i.e., tangible) asset that can be transacted in any locale.

Be sure to check in regularly to the Masterworks research hub as we dive deeper into topics and issues based on art indices, as well as understanding art as an asset class generally.