Elon Musk, the world's richest person, recently revealed his strategy for investing alongside record inflation.
According to the WSJ, since February 2020, the Fed increased the nation’s money supply by a staggering 40%. To some experts, it explains why the U.S. is experiencing its highest inflation rate since 1981.
The Tesla and SpaceX founder told investors, in his experience, it’s “better to own physical things than dollars when inflation is high.” That’s especially shocking from Musk, who has historically passionately supported cryptocurrencies and other digital goods.
The “physical goods” he mentioned could include oil, metals, and grains, which have all soared in prices…
But there’s another physical asset that billionaires have historically been stocking up on: fine art.
In fact, according to Deloitte, over 61% of the ultra-wealthy diversify their portfolio with fine art. Here are a few possible reasons:
- Contemporary art prices outpaced the S&P 500 by more than 2.5x (1995-2021).
- Contemporary art historically returns 23.2% each year, on average, when inflation is at least 3% (like it is right now).
- It has a low correlation to public equities of any major asset class, according to Citi.
Normally, it’s impossible for everyday investors to buy blue-chip art because it often costs tens of millions of dollars for a single work. But thanks to changing regulations, companies like Masterworks have made it possible for nearly anyone to invest in art.
Since launching in 2019, Masterworks has…
- Grown to 639,000+ users
- More than $700,000,000 in assets under management
- Been featured in the WSJ, NY Times, Blomberg, CNBC, and plenty others.
To learn more and see past offerings which include Monet, KAWS, and Basquiat, sign up for a free Masterworks membership right here.