Osian Art Fund, which was announced as the world’s first art fund in 2006 promising great returns, made a quiet exit in August 2009, disappointing its investors with returns as low as 5% per annum for the past three years.
Osian's-Connoisseurs of Art Private Ltd, a leading archive and auction house, had announced the art fund in July 2006. The art fund was a close-ended scheme for a period of thirty- six months. Though the Fund was expected to initiate more art funds all over the world, it exited with low returns in August 2009.
The 5% annual returns return translates into Rs115 on Rs100 invested in art through the Fund in 2006. In contrast, the BSE Sensex was above 10,000 when the art fund was launched and it’s flirting with 17,000 today, a rally of 70%.
“In retrospect the fund entered at the peak of the art market and is exiting at the bottom of the market. This was not good timing. However, it is easy to say this now on hindsight, no one expected poor performance in 2006,” said a company official from Osian.
The art fund matured in August 2009, and the company is in process of distributing the return to its investors. The purchase price per unit was Rs100 and the minimum investment was supposed to be Rs10 lakh. The project was started to create an asset class for Indian cultural artefacts over a period of thirty- six months