Art Is a Rising Focus for Wealth Managers and Family Offices
3 min
The value of art and collectibles owned by the world’s wealthiest individuals totaled nearly US$2.2 trillion as of last year, an amount that could grow to nearly US$2.9 trillion by 2026, according to recent analysis from wealth management advisor Deloitte Private and ArtTactic, a research and analysis firm. Yet, the art market overall has grown only 0.6% annually since 2008, failing to keep up with inflation, and with the surge of growth in overall global wealth.
Deloitte Private—a division of U.K.-based Deloitte—and London-based ArtTactic said in the eighth edition of their biennial Art & Finance Report. That means there are many more wealthy people who could own art. The report proposes an intriguing reason for the stunted growth: The fact that more than three-quarters of auction sales are generated by the work of a little more than 1% of all artists.
“We can assume that only a small percent of art buyers are behind these transactions, which leaves us with a heavy concentration around a small number of artists and buyers—plus a small number of art professionals (galleries, auction houses, etc.),” the report said. “Could this be one of the main reasons for the art market’s overall lacklustre growth in the last decade?”
The more than 400-page report, which examines trends and developments at the intersection of art and wealth management, is informed by surveys with private wealth managers and this year, with several family offices, where art and collectibles comprise 13.4% of client assets—five percentage points more than at private banks.
“While art and collectibles provide portfolio diversification and potential value appreciation, they often are a more personal investment with emotional ties to the family’s interests and preferences,” Wolf Tone, the global leader of Deloitte Private, said in the report.
Overall, 89% of wealth managers in addition to collectors and art professionals who were also surveyed, believe “art and collectible wealth should be part of a wealth management offering,” up from 65% that said so in the first Art & Finance survey in 2011. One reason art is touted as an investment option is its value doesn’t move in sync with traditional market instruments; another reason is the perception that the art market’s performance has been relatively strong compared with measures such as the S&P 500—a broad measure of U.S. stocks.
Fine art indexes developed by New York-based Artnet Worldwide Corp. reveal a more nuanced picture. In the five years up to the first half of 2023, the compound annual growth rate for fine art was a negative 0.4% compared with a 10.4% gain for the S&P 500, according to Artnet. Looking at individual investing categories, European Old Masters recorded a 1.6% CAGR in that period, while global post-war art (by those born between 1911 and 1944) posted a CAGR of 1.4%. Over 10 years, the CAGR for fine art overall was only 0.1% compared with a 10.7% gain for the S&P 500, according to Artnet. Artnet analysts noted in the report, however, that art—as a physical asset—is a better hedge against inflation than traditional market instruments, such as stocks, which are valued according to the expected future cash flows of their underlying businesses. Fine art returns rose 4.2% between January 2022 and July 2023 compared with a 6.6% decline in the S&P 500.
“Despite a spike in inflation and higher interest rates, art prices suffered less than other asset classes during this period of economic stress, demonstrating the asset class’ ability to serve partially as an effective hedge, especially regarding the blue-chip, high-end fine art category,” the report said. Though the report confirmed that most people still buy art because they like it—60% of collectors are driven by art’s “emotional value,” consistent with past years—financial factors are rising in importance. For the first time, 41% of collectors surveyed said their primary motivation for buying art was financial, overtaking “social value” as the second-ranked motivation.
One reason is that younger collectors are largely driven by financial considerations: 83% cite potential investment returns as a key reason to buy art, up from 50% in the last survey in 2021. Of those surveyed, 61% also cited portfolio diversification as a driver and 51% said art can be a safe haven in uncertain times, up from 34% in 2021.
“This tells us about how the new generation of collectors may relate to art as an alternative capital asset class, both now and in the future,” the report said. The rise of art investment vehicles, particularly fractional-art platforms that allow individuals to buy a share in a painting as they would a share of stock, are another factor: 50% of younger collectors are interested in fractional ownership, up from 43% in 2021, the report said. The most popular way to buy art remains just that—directly buying a piece, according to 88% of collectors and 83% of art professionals.
Yet fractional ownership is making inroads, particularly as more initiatives offer options that are supervised by regulators in the U.S., Europe, and Asia. Though resistance remains, the report said the emergence of these platforms “could allow art and collectible assets to be more easily integrated into asset management allocation strategies in the future.”
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Overall, the season showed that share prices react less to whether profits rose or fell than to the gap between results and expectations
5 min
Reporting season has once again reminded investors that a strong profit does not guarantee a rising share price, and a large loss does not always trigger a sell-off. What matters most is how each result compares with expectations and, increasingly, what management says about the year ahead. During the August 2026 season, companies offering credible turnarounds or unexpectedly strong guidance were rewarded handsomely, while those flagging weaker margins, slowing demand or greater uncertainty were punished.
The following ranking draws on Morningstar’s review of 164 ASX-listed companies and measures each company’s share-price movement on the day it reported. This captures the market’s immediate response to the earnings announcement, before subsequent economic developments, dividends and company-specific news cloud the picture. Here are the five biggest winners, and the five hardest-hit losers, of the season so far.
The five winners
1. Bapcor (ASX:BAP): +41.0%
Bapcor delivered reporting season’s largest relief rally after presenting early evidence that its troubled automotive-parts business was stabilising. Although underlying revenue fell 1.8% to $1.92 billion and underlying NPAT collapsed 85% to $10.8 million, underlying EBITDA of $152.5 million exceeded guidance.
More importantly, working-capital initiatives released $68.5 million in the second half, lifting cash conversion to 109.4% and reducing net debt by 63% to $135 million. The statutory loss was $431.6 million, largely because of non-cash impairments. Investors focused on improving operational momentum, stronger liquidity and management’s expectation of modest FY27 revenue growth.
2. Zip Co (ASX:ZIP): +18.2%
Zip comfortably surpassed its FY26 targets, sending the buy-now-pay-later provider’s shares sharply higher. Transaction volume rose 23% to $16.7 billion, while cash earnings before tax, depreciation and amortisation jumped 58% to a record $268.9 million. Statutory profit climbed 46% to $116.4 million, and the cash operating margin expanded by 4.2 percentage points to 20%.
The strongest signal was guidance for FY27 cash earnings of $340 million—around 26% growth and above analysts’ forecasts. US transaction volume increased 42.5% and now represents three-quarters of group volume, offsetting weaker customer activity in Australia.
3. CSL (ASX:CSL): +17.3%
CSL’s result was hardly spectacular in isolation, but it cleared a market bar that had fallen dramatically following earlier downgrades and restructuring announcements. Underlying NPATA was US$3.1 billion, down 2% in constant-currency terms, while operating cash flow reached US$3.51 billion.
CSL maintained its full-year dividend at US$2.92 per share and completed a A$1 billion buyback. The real catalyst was FY27 guidance for approximately 5% underlying profit growth, compared with market expectations closer to 2%. After an extended period of earnings disappointments, investors interpreted the outlook as evidence that CSL’s core plasma business was approaching a sustainable recovery.
4. Judo Capital (ASX:JDO): +16.9%
Judo Capital demonstrated strong operating leverage as its specialist business-lending franchise expanded. Full-year profit before tax rose 34% to $168.1 million, while pre-provision profit increased 42%. Gross loans and advances grew 18% to $14.7 billion, reaching the top of the bank’s guidance range and comfortably exceeding broader system growth.
Deposits increased 24% to $12.2 billion, return on equity improved by 1.1 percentage points to 6.4%, and earnings per share rose 29% to 9.9 cents. Reaffirmation of the FY27 outlook gave investors confidence that loan growth could continue without sacrificing margins or credit quality.
5. Super Retail Group (ASX:SUL): +15.8%
The owner of Supercheap Auto, rebel, BCF and Macpac reported record sales of $4.2 billion, up 3.2%, despite cautious discretionary spending. Profitability went backwards: normalised profit before tax fell 7% to $306 million and normalised NPAT declined 2.8% to $226 million as transformation spending weighed on margins. Nevertheless, the result exceeded subdued expectations, online sales grew 5.3% and membership across the group’s loyalty programs reached 13.1 million. Investors were also encouraged by positive early FY27 trading, stable gross margins and continued market-share gains. A fully franked 33-cent final dividend added to the appeal.
The five losers
1. Hansen Technologies (ASX:HSN): –21.2%
Hansen’s historic result met expectations, but investors recoiled from its outlook. The utility and communications software provider achieved an underlying EBITDA margin of 31%, exceeding its 30% target, while generating strong cash flow. However, management designated FY27 an “investment and transition year”, signalling a roughly five-percentage-point margin contraction as spending on products, sales capabilities and organisational changes increased.
Revenue had already been broadly flat, leaving investors concerned that the investment program would depress earnings before new growth appeared. Leadership changes, including the chief executive’s departure, added uncertainty. Management expects revenue growth and margins above 30% to return in FY28, but the market was unwilling to wait.
2. Life360 (ASX:360): –19.4%
Life360’s headline growth was impressive: quarterly revenue rose 38% to US$159 million, subscription revenue increased 31%, and adjusted EBITDA climbed 53% to US$31.1 million. Monthly active users reached 102.4 million and paying circles grew 27% to 3.2 million. The sell-off reflected expectations rather than a collapsing business.
Net income fell 18%, the net margin contracted from 6% to 3%, hardware shipments dropped 18%, and full-year EBITDA guidance was merely maintained. After a strong valuation run, investors wanted a larger upgrade and clearer evidence that heavy investment in advertising, international expansion and artificial intelligence would generate additional earnings.
3. PEXA Group (ASX:PXA): –17.0%
PEXA reported a 7% increase in continuing-operations revenue and 12% EBITDA growth to $152 million, accompanied by a two-percentage-point margin expansion. Free cash flow increased 39%, suggesting the core Australian electronic-conveyancing platform remained highly profitable. Investors instead concentrated on management’s warning that property-transfer volumes could decline, alongside regulatory uncertainty surrounding the fees PEXA can charge.
The company is also continuing to invest heavily in its loss-making international expansion. Morningstar considered the market reaction excessive, arguing that structural transfer-volume assumptions had not materially changed, but the combination of softer near-term activity and regulatory risk overwhelmed the respectable headline numbers.
4. SEEK (ASX:SEK): –14.3%
SEEK produced solid FY26 figures, including 10% revenue growth to $1.20 billion, a 15% rise in EBITDA and 28% growth in adjusted earnings per share. It also lifted its fully franked annual dividend by 13% to a record 52 cents. Those achievements were overshadowed by falling paid job-ad volumes and cautious FY27 assumptions.
The statutory accounts included a $201 million loss from the SEEK Growth Fund and $377 million of significant items, making the headline result considerably less attractive. Investors were particularly concerned that economic weakness could limit volumes while the company continued investing in platform integration and artificial-intelligence products.
5. JB Hi-Fi (ASX:JBH): –12.3%
JB Hi-Fi’s full-year result was broadly respectable, with group sales rising 5% to $11.1 billion and underlying earnings per share increasing 6% to $4.48. The damage came from its current-trading update. Australian sales were almost flat during the June quarter and deteriorated further in July, while earnings in the core Australian electronics business fell 3.6%.
Housing-related categories were particularly weak as higher living costs and interest rates constrained household budgets. With JB Hi-Fi entering the season on a demanding valuation, an in-line historic result was not sufficient: the loss of sales momentum prompted investors to rapidly reduce their expectations for FY27.
Overall, the season showed that share prices react less to whether profits rose or fell than to the gap between results and expectations. Bapcor was rewarded for being less troubled than feared, while several fundamentally profitable companies were punished because their outlooks failed to justify elevated valuations.
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