Many of us have at some point or the other heard that great works of art, are a good investment. Recent figures posted by Christie’s and Southby’s have been impressive, and have raised further questions and added more fuel to the debate on whether or not Fine art can be considered a valid investment option.

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Two Professors Michael Moses and Jiangping Mei at the New York University’s Stern School of Business, have taken to compiling what they call, the Mei Moses Fine Art Index. Basically, they take the original sales price of a work of art, and then they see the latest selling price at an auction house, and annualize the returns.

On an average, they found that over the last 50 years, the index returned an average of 10.5%, which only marginally underperforms the stock market. However, there are significant difference in terms of liquidity, obviously.

Warren Buffet however, feels that art comes nowhere close to the stock market. He took the Mona Lisa, and found that it had sold in 1540 for $20,000. If that had been invested in the stock market at a modest 6% ROI, it would have become 1 quadrillion dollars by this time. That’s way above what the Mona Lisa is worth now (Around $100 Million)!

This argument seems to put the final nail in the coffin with regard to art as a long term investment.