Masterworks.io is a platform that offers an investment opportunity by selling shares in high-quality artworks. There are not many companies that specialize in art investment, making Masterworks one of the limited options for individual investors to invest in art.
To help you determine if this platform is suitable for your needs, let’s take a closer look at the review provided by tradingcritique.com.
Table 1: Masterworks.io Overview
| Masterworks.io Highlights | |
|---|---|
| Year Founded | 2017 |
| Regulated By | The Securities and Exchange Commission (SEC) |
| Account Types | Masterworks Account |
| Minimum Deposit to open an account | $0 |
| Minimum investment | Depending on how much the artwork costs |
| Trading platforms | Desktop & Mobile app (available for Android and iOS) |
| Holding period | 3–10 years |
| Annual Management Fee | 1.5%/year |
| Commission | 20% of the profit |
| Investment Returns | 9% to 39% |
| Market Instruments | Fine arts |
| Fractional Investing | YES |
| Secondary market | YES |
| Customer Support | Friday, 9 a.m. to 6 p.m. EST |
Masterworks.io Review- An Intro
Masterworks is a company that allows you to invest in fine art without purchasing the full piece. This fascinating opportunity is provided by the unique investment platform. An online investment site, Masterworks, offers blue-chip works of art that you can either hold onto or buy and resell. Masterworks’ primary asset class is a fine art, which is categorized as an “alternative investment,” as opposed to more conventional assets like stocks and ETFs.
Masterworks was established in 2017, and as of this writing, it has more than 400,000 registered users, more than 100 works of art, and $400 million in securitized paintings.
Masterworks.io – Knowledge bites
You can buy shares on top-performing art markets through Masterworks and possibly resale those shares on the secondary market. Investors are facilitated by Masterworks’ highly qualified research team through a portfolio of the finest works of art from around the world. Masterworks has created a database of artwork purchase histories, which it uses to decide which artists to invest in. Masterworks keeps the art it buys in proper storage and has annual appraisals.
Regulations & Trustability Review of Masterworks.io
The Securities and Exchange Commission (SEC) regulates Masterworks. Before being added to the platform for investors, all of Masterworks’ offerings are officially qualified by the SEC.
Table 2: Masterworks.io Regulation details
| Regulation | Country | Headquarters | Registered Office |
|---|---|---|---|
| The Securities and Exchange Commission (SEC) | United States | New York | Masterworks.io, LLC225 Liberty St. 29th Floor, New York, NY 10281 |
Safety Review of Masterworks.io
Your artwork is kept secure by Masterwork. To protect your investment, Masterworks stores the painting after it has been purchased. . The piece of art is then kept by Masterworks in a temperature-controlled gallery or museum. This is done for security and insurance reasons In return, you pay storage and insurance costs of 1.5% of your entire share amount.
Review of Accepting Countries of Masterworks.io
Masterworks provides its service to all countries while the secondary market service is only available to US investors.
Masterworks Account opening process
Table 3: Steps to open an account on Masterworks
| Follow the below steps to open a Masterworks account: |
|---|
| – Visit the Masterworks website first. – You must complete the required information to apply for membership. – Then click the “Request Invitation” button. – You will receive an email from Masterworks with a “Confirm Email” link to confirm your account information. – You’ll be directed to this Masterworks investor homepage. – Click the “Finish” button once you’ve specified the amount you intend to invest – Then Masterworks makes appointments for phone interviews. – Click “complete.” – Link your bank account to Masterworks. – Then Masterworks makes appointments for phone interviews. – The next step is to select “complete,” after which you may begin connecting your bank account to Masterworks. – Next, you can begin looking through the available investment options. |
Review of Masterworks Phone Interview
- You must schedule a phone interview to activate your Masterworks account (It usually lasts 15- 20 minutes).
- Discussion of your financial profile (KYC), and minimum investment profileis the main purpose of the phone interview which helps to walk you through the first investment.
- You will be added to Masterworks’ waitlist after the interview process.
- Investors that wish to quickly enter the art market might want to sign up quickly to secure their spot.
How Masterworks operates
Masterworks is the first marketplace where you can sell and buy shares that represent an investment in famous artworks. Here’s an overview of how Masterworks works:
Purchase of artwork
The research team at Masterworks uses exclusive data to identify the top artist markets. It selects outstanding artists with verified histories of appreciation using data from over 1 million art auctions. Then its team identifies artworks and buys them.
Creation of Shares
After a purchase, Masterworks engages with the Securities and Exchange Commission (SEC) to securitize the artwork. It converts works of art into securities that everyone can buy and shares are issued in $20 increments. Individual investors are not permitted to hold more than 10% of any given work.
Holding of Shares
Masterworks normally hold the artwork for 3–10 years. It might even show it at its exclusive gallery for members in New York City. All users of the site have the choice to sell their shares on the secondary market or wait for all of the shares in the artwork to sell.
Note:
You should be aware that both options need waiting. Even if you desire to sell your shares again, you cannot do so until at least 90 days have passed since the offering’s close and all the shares have been sold. Additionally, Masterworks has a five-share minimum sell order requirement.
Selling of Shares
The majority of the artworks will be sold, according to Masterworks, in three to ten years. When an artwork is sold, taxes and expenditures are deducted, the issuer company is liquidated, and the remaining net revenues are given to shareholders by the priorities outlined in Masterworks’ operating agreement.
You can sell on the Masterworks secondary market if you want to leave early. Instead, you may invest in a piece of art that is being offered as shares on the secondary market. Masterworks currently provides this secondary market service to US investors only
Fees & Commissions Review of Masterworks
No investor may own more than 10% of any one work of art, and the minimum investment amount varies based on the piece of art you’re investing in. For each year you invest with Masterworks, a 1.5% yearly management charge is required. This payment is used for services like transportation, storage, and insurance for artwork.
If the painting has increased in value, Masterworks will charge a flat 20% commission on profits when the piece is sold through the site. Institutional investors are held to different standards than commercial investors.
Most Popular Artists of Masterworks
Masterworks currently invests in the following popular artists:
Table 4: Names of most famous artists who invest in Masterworks
| Yayoi Kusama. |
| Mark Rothko |
| Keith Haring |
| Kaws |
| Pablo Picasso |
| Andy Warhol |
| Jean-Michel Basquiat |
| Banksy |
Review of Masterworks Returns
The artists that Masterworks chooses have commonly presented an above-average historical appreciation (returns are higher than the average returns of the stock market, which range from 7% to 10%).
Most Masterworks artists have experienced historical returns between 12.70% and 19.80%, which is roughly double to triple the returns you usually see in the stock market.
Is the artwork a good investment?
Masterworks aims to attract investors who want to expand their portfolios beyond more conventional assets like stocks, bonds, and other instruments. Contemporary art also offers impressive returns as an asset class. Masterworks is not the platform for you if you want to invest for a regular source of income because it doesn’t offer dividends. Liquidity is not assured.
Education and Research Review of Masterworks
Masterworks makes it simple to discover more about the life history of the painters whose works it sells. Even more, information is included in the “Further Reading” section of each piece to assist you to understand a little more about the history of the piece being offered for sale.
You may view the return of thousands of paintings and artworks by looking in Masterworks’ unique price database. Masterworks provides open FAQs where the platform outlines the benefits and drawbacks of purchasing art.
Masterworks Insights is a center of interesting, well-researched, and educational articles. The Insights section also comprises a third-party research section that collects outside news items about art from a range of well-known sources. Articles from Barclays, Morgan Stanley, and Deloitte, can be found here. Articles are updated regularly.
Advantages & Disadvantages of Masterworks
Masterworks have both advantages and disadvantages which are listed in Table 5.
Table 5 : Pros and Cons of the Masterworks website
 Pros of Masterworks |  Cons of Masterworks |
|---|---|
| Good investing research on art and the contemporary art market is provided. | You must go through a quick interview with the company to join. |
| Masterworks handles finding, buying, and storing art. | It may take 3 to 10 years for the business to sell a piece and return profits to investors. |
| Fractional ownership of fine art. | |
| Supports a mobile application. | |
| Provides early liquidity via a secondary market. |
Customer Support Review of Masterworks
Masterworks provides customer service via phone and email. The Masterworks customer service team is available Monday through Friday, 9 a.m. to 6 p.m. EST. You will be assigned a dedicated representative who will be available to answer your inquiries at any time.
Table 6 : Customer support service details of Masterworks
| Social Media Pages of Masterworks | |
|---|---|
| Telephone | 203-518-5172 |
| support@Masterworks.io | |
| https://twitter.com/MasterworksIO | |
| https://www.linkedin.com/company/Masterworks-io | |
| https://www.facebook.com/Masterworks.io | |
| https://www.instagram.com/Masterworks.io/ | |
Frequently Asked Questions – Masterworks
1. Where is Masterworks situated?
Masterworks is headquartered in New York City.
2. How long have there been Masterworks?
Masterworks is an online investment platform founded in 2017.
3. What are the fees for Masterwork?
Masterworks charges a 1.5% annual maintenance fee plus 20% of the earnings from the sale of paintings. There is a 1.5% wire fee if you sell shares on the company’s secondary market.
4. Is Masterworks legal or not?
The Securities and Exchange Commission (SEC) regulates Masterworks, a legitimate alternative investing platform.
5. Who is the owner of Masterworks.io?
The owner and CEO of Masterworks.io is Scott Lynn.
In a Nutshell – Masterworks Review
- Masterworks enable investors to purchase works of art that are worth a million dollars.
- While Masterworks looks for an individual collector or buyer to purchase the art, it is kept in a secure, climate-controlled facility.
- Masterworks does not guarantee returns in this risky asset class. Even with its secondary market, it does not ensure liquidity.
- Before Masterworks sells the artwork, the investor has the option of selling their art shares on the secondary market.
- Great works of art by painters like Claude Monet, Andy Warhol, Pablo Picasso, and others are available for purchase as shares.
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