Novel Model Evaluating Art Market Returns Shows Retained-Equity Portfolios Significantly Outperform S&P 500


What would happen if the artists Jasper Johns and Robert Rauschenberg had retained 10 percent equity in the artwork sold in the start-up phase of their careers? This question is the focus of a new study from Amy Whitaker, NYU Steinhardt School of Culture, Education, and Human Development in partnership with Roman Kräussl, University of Luxembourg introducing a novel investment framework to reflect the artist’s role as an early stage investor in their own work.                                                

The study finds that artists can reap significant financial rewards from holding an equity stake in their artwork—compared with investing the equivalent dollar amount in the S&P 500—and is among the first to quantitatively test a retained equity model using first-sale prices alongside auction results.

“The fractional equity model represents a necessary structural correction to how we view artists. Art is currently priced and not valued; the market doesn’t account for initial economic risk or investment by the artist. Artists, like any early investor, should have exposure to the upside they helped to create,” said Amy Whitaker, an assistant professor of visual arts management at NYU Steinhardt and the study’s lead author.

The study combines publically available auction data with private sales information to analyze the returns on retained equity for ten Rauschenberg works and nine Johns works sold via the Leo Castelli Gallery between 1958 and 1963. The data show that Rauschenberg’s portfolio would have generated returns 2.8 to 140.8 times greater than an equivalent investment in the S&P 500, with John’s portfolio outperforming the market by a factor of 24.9 to 986.8.

For instance, a 10% equity stake in Rauschenberg’s work State—sold in 1959 for $300—would have become $44,000 in the art market. The same $30 investment in the S&P 500 would have returned $2,417 over the same time period.

Whitaker acknowledges the results are buoyed by the meteoric success of the artists in the study, but indicated the outsize returns show why shared value matters. “It’s necessary to have a conversation about artists being modeled as investors, whether they become as successful as Johns and Rauschenberg or not. This study shows you the maximum possible return to the artist and therefore articulates why structural intervention in markets for creative work deserves serious consideration,” Whitaker said.

The study extrapolates that modeling equity portfolios for artists will also introduce a secondary market for shares—independent of the sale of the artwork itself—and facilitate a system of ‘fractional ownership.’ Fractional ownership allows for more democratic investment in art markets, as collectors can diversify their portfolios without the need to purchase whole works, and artists can sell shares to fund future projects. Whitaker advocates the use of blockchain technology—an open and distributed ledger securely recording and verifying transaction data—for the management of fractional shares.

“The whole idea of fractional ownership is really one about shared creation of value. Artists’ equity shares remind us—contrary to the myths of creative genius and the related archetype of the starving artist—of how many different actors there are in the creation of value in art markets, including gallery owners, collectors, and artists. It makes sense that we’re exploring this now because the technology is really there. Specifically, the blockchain, but there are also other technologies that would allow us to manage fractional equity in ways that don’t have onerously high transaction costs,” said Whitaker.

The current system of resale royalties—where artists are paid a percentage of the increase in value when a work is sold—are often criticized for bureaucracy, costliness, and poor enforcement, but Whitaker says emergent technologies can mitigate these issues.

The study also offers wider implications for other creative fields in which early-stage work is difficult to value.

“The system can generalize the ways we compensate early stage creative work in any field. This is good for individual workers and reorients the way we look at growth in the economy overall,” said Whitaker.

In addition to Whitaker, the study “Democratizing Art Markets: Fractional Ownership and the Securitization of Art” was co-authored with Roman Kräussl from the Luxembourg School of Finance at the University of Luxembourg.

About the Steinhardt School of Culture, Education, and Human Development
Located in the heart of Greenwich Village, NYU’s Steinhardt School of Culture, Education, and Human Development prepares students for careers in the arts, education, health, media, and psychology. Since its founding in 1890, the Steinhardt School's mission has been to expand human capacity through public service, global collaboration, research, scholarship, and practice. To learn more about NYU Steinhardt, visit

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