What do you have to pay attention to when investing in instruments?

Instrument investments instead of inflation

In times of low interest rates, high real estate prices and turbulent stock markets, many people are looking for alternative ways to securely invest or even increase savings. In this context, stringed instruments represent an attractive addition to the portfolio because, in addition to being artistic, they can also have exceptionally high economic value.

Classical Italian and French violins are often traded for five, six or even seven-figure sums and According to the Fuchs Tax, they have achieved a steady annual increase in value of five to eight percent for more than a century. In recent years, even significantly double-digit returns have been possible: jewelry from Stradivari, Amati, Gofriller or Guarneri yielded around eight to 15 percent annually, depending on the condition.

These return opportunities are largely due to the current inflation environment, but there are also other influencing factors. For example, the supply of rare and old instruments is limited, while demand is constantly increasing. Especially from buyers from China and Korea, who ensure more competition and high market prices.

Keep an eye out when buying instruments

The price of an instrument is influenced in particular by criteria such as rarity value, condition and quality. Since an investment with stringed instruments is ultimately based on the expectation of higher prices in the future, careful selection of top-class instruments is decisive for investment success. This is because the return only results from the difference between the purchase and selling price.

Instrument investors should therefore pay attention to the following criteria before making a purchase:

• Famous manufacturer or violin maker

There is no doubt that at the “tip of the iceberg” are Antonio Stradivari and Giuseppe Guarneri del Gesù. Antonio Stradivari had produced more than a thousand instruments until his death in 1737, a few hundred by his neighbor del Gesù. Of these, around 600 violins, 60 cellos and twelve violas, which have a stamp with the initials Stradivari on the inside, and a good 140 violins from Guarneri del Gesù's workshop are still preserved. The cult of 300-year-old violins has driven prices to tens of millions of euros in recent decades. But also Nicola Amati, Matteo Gofriller or Jean-Baptiste Vuillaume went down in music history as manufacturers of stringed instruments.

• Unique sound

Of course, the sound and playing characteristics of an instrument are particularly important. However, the quality of a violin can never be attributed to a single cause — neither to a mysterious lacquer nor to a particular nature of the wood. Many ancient instruments, which are characterized by an unmistakable maturity in tone, are therefore both “carved from a special wood” and characterized by the unique skill of their maker.

• provenance

Instruments suitable as investments can usually be found at auctions, violin makers or some violin dealers. However, when buying, interested parties should make sure that the instrument has a complete provenance. On the one hand, guarantees of origin ensure that the buyer does not purchase a stolen or fake instrument. On the other hand, he can ensure by means of complete provenance whether the violin, viola or cello was professionally stored and maintained and how many previous owners there were.

• Special history

These include an extraordinary story that an instrument “experienced” as well as well-known musicians who played on it. For example, the most expensive cello in the world, “Mara”, was already a myth after it had left Antonio Stradivari's workbench in 1711. But it became a legend on the night of July 12, 1963, when the musician Amadeo Baldovino boarded the ferry to Buenos Aires in Montevideo. When it hit a sunken wreck and caught fire, Baldovino jumped into the water with the cello case, but lost sight of it. Later, however, “Mara” actually reappeared in individual parts and was carefully reconstructed. Its value is currently estimated at over ten million dollars.

In addition to a compelling story, an instrument can also become famous (and valuable) because it has been played by a prominent musician over the years. The game also has an important side effect: High-quality copies must be played regularly, otherwise they may lose sound quality. This also explains the fact that the most valuable instruments from the world's well-known private collections are regularly lent to renowned artists.

• Impeccable condition

But even the rarest instrument from the best manufacturer with a complete provenance is not suitable as an investment if the condition is not perfect. Among other things, the paint or “patina” as well as the expert repair of an instrument play an important role. However, these criteria can only be assessed by experts, which is why seeking an expert opinion is highly recommended.

Attractive tangible assets — for music lovers and investors

For the layman, all of the above points are hardly reasonable to assess, which is why investors should always seek advice from one or more experts before buying the extremely expensive instruments. The market is also regarded as opaque. This is why buyers are always faced with the challenge of finding a trustworthy business partner.

As a platform for digitized instrument investments, FINEXITY checks factors such as provenance, quality and value and selects only the potentially best instruments for investors. This is achieved through an experienced and globally networked partner network of leading retailers and through cooperation with renowned orchestras, which lend acquired instruments to musicians. In addition, through professional analysis of markets and market trends, the optimal time to sell is anticipated and the highest possible return is achieved - starting from an investment amount of 500 euros.