Tosogu as an investment

[Justin]

I am interested in doing some research into tosogu as an investment (rate of return over time). Don't get me wrong I don't primarily collect for investment purposes, although I do like to think that there will be a market there if I ever decide to sell.

 

I would appreciate if anyone could let me know if they spot anything that was originally sold in one of the big auctions in the past (Comption, Haynes, Mosle, Wragham, etc). I have most of these catalogues and can compare the price then and now and work out some averages, possibly by artist if the sample is big enough.

 

Perhaps someone has already done this ... ?

 

Anyway please just post here or email me at justinorr (at) zoho.com if you see anything on your travels.

 

Thanks in advance.

[Alex A]

Justin, being honest, poor investments....

 

Alex.

[hxv]

Justin,

 

Here is what I have come across - tsuba from the Hartman collection, sold in 1976, now on sale on the Silk Road website. Do you have the Christie's sales catalog "The Hartman Collection of Japanese Metalwork?"

 

http://www.silk-road.us/ship1.html

 

The tsuba is listed at $950 (not selling, mind you). It was part of a two-tsuba lot that sold for 95 British Pounds in 1976. Hope this helps you in some way.

 

Regards,

Hoanh

[Rich S]

Never collect anything as an investment. The collectibles market is too volatile and has major changes over time (sometimes very short times). What's collectible today, you can't give away tomorrow. This even goes for "fine art"; today it's Picasso, tomorrow it's Monet. Today it's Kiyomaro, tomorrow it's Sadatsugu, etc. No predicting the collectibles market. Collect because you like/love the item, not because it may or may not increase in value. Collect what you like, but like what you collect - and don't count on retiring on the sale income. You'll end up living in your kids garage :-) Just my $0.03 (allowing for inflation).

 

Rich S

[Alex A]

Who knows, Justin, you may get lucky!. Whilst on the subject, I was wondering how many dealers truly make a living from selling nihonto?. Most I suspect, do this as a part time hobby kind of thing...

 

Alex.

[Curran]

Japan: prolonged boom 70s, 80s. Long bust into 90s, 00s.

Value of art from a particular country often follows its economic progress, with some exceptions.

The Chinese art sold to us by a mainland friend in the 1990s has gone up 10x. I wouldn't buy it now.

Frame of reference on the data matters significantly.

 

Japanese Nihonto and related: Been following for about 25 years, but only actively collecting 15 years.

Been focusing on kodogu the last 9-10 years.

 

Post 9/11 seems a lot of former sword collectors have migrated into fittings. Also new collectors in fittings.

Also, watched the price of many WWII swords rise significantly.

 

As to fittings- they've definitely faired better than most swords:

(1) Many of the desirable higher end fittings have risen in price. Better than the US stock market the last 10 years. Since the Fittings Museum closed and was auctioned off 9-10 years ago- not seeing such stuff come to open market.

(2) Mid end: cycles up and down with fads, publications in English, and supply/demand. 6 to 8 years ago everyone was collecting Kanayama tsuba. Now, not so much.

(3) Low end: iron tsuba have definitely softened in price, whereas kinko have firmed or risen with the price of gold, silver, etc.. Cost you at least 2x to have something made as it would to buy an original. However, I would say the # of desirable tsuba you see on eBay nowadays is gone to almost 0. Best place in the world to buy now is at a US sword show (ie. San Fran) if you know what you want and will bargain.

 

While seeing more and more of the older desirable stuff like Goto work come to market at fair prices as older collections break up, other areas which were less understood or known outside of Japan (and books have since been translated into English) have gone up in demand for what is slightly dwindling supply. Ito-san's work, Markus' work, and several other private sources have given some of us libraries and knowledgeable more powerful than we had 10 years ago.

 

I'll also use this as a chance to promote Markus' blog: http://markussesko.wordpress.com/

[Kurikata]

As far as Europe is concerned, very old collection items (collections beginning of 20th century) with pictures in the auction catalogues at that time (Marquis de Tressan, Behrens, Bing, etc...) are estimated twice or 3 time the price of a similar tsuba with no reference.

 

Depends on you choice: either the object of the references.

 

Bruno P.

[raiden]

As a Dealer and a Collector, I can speak only from my experience. Buy good, and buy well, quality always finds a home. Kodogu has become very strong along with high end swords. I like the fact that I can enjoy them until I decide to sell. Stock market too volatile and unknown to me and less enjoyable......

Kodogu has now become a world wide collectable in quality - Russia, Europe, The US/Canada/ Australia / New Zealand ...dare I say even the folks in South Africa!

If you come to the show, please visit our table and we will show you some Juyo tosogu...

Mike

[nagamaki - Franco]

Food for thought; buy knowing that if things go south you would still be happy and content owning the piece in question. Don't spend the mortgage money, nor food money, nor your children's education funds on such things. Better pieces tend to maintain their value, but are still subject to fluctuations. Also, if purchasing heirlooms make sure those receiving are fully educated and appreciative which includes responsible recipients. Buy low, there are great deals out there in tosogu for those willing to take the time to invest in learning and attend shows. An important part of collecting is learning to let go.

[Brian]

Something popped into my head while I was browsing the NMB...kinda struck me as odd since I am not even sure if I agree with it :?

But it is some food for thought....

"Buy what you like. But invest in what others like"

I guess that means if you are going to invest, you need to study trends and what will always be in fashion. Not easy. Hence why so many people collect for themselves and not for investment.

 

Brian

[Alex A]

High cost items can be hard to sell on, easier for well known and respected dealers to ask higher prices. Bare that in mind when you decide to be a bit lavish with the spending. People prefer to buy from reputable sources, hence the large amount of consignment sales that you see. Your average Joe (ie me) can have a blowout once in a while that will likely upset the wife ( one, maybe two in life max :D ), but tieing too much money up in this hobby I think is unwise, unless your wealthy, then it is not as big of a concern. Buy what you like, BUT what you can afford.

 

Alex.

[nagamaki - Franco]

" But invest in what others like"

 

Just keep in mind that you could end up owning what others like. And then what do others like? Sometimes it is difficult to tell if others know what others like.

[watsonmil]

Dear Justin et al,

 

One should never collect with investment as a reason. Collecting, be it stamps, coins, firearms, or nihonto and related artifacts should be for : interest, love, and study, ... never for the desire to turn a profit. Having in the past operated one of the most prestigious Internet Antique Fine Arts and Weapons Businesses in the world, ... I believe I can speak with a little authority on the subject. When I started back in the early 1970's, ... I remember selling a very nice Sharpes Rifle for $ 750.00, .... I later bought the same rifle back in the early 1990's from the estate auction and subsequently sold it for $ 3750.00. It took 17 years at an average bank interest of 10% to for the $ 750.00 investment to return the selling price of $ 3750.00.

 

What one must remember is I used 10% as an average return, ... not all years returned 10%, ... a few years were higher and a few lower. Meanwhile the value ( what could be purchased ) with that $ 750.00 in the early 1970's was about the same or less than what $ 3750.00 could purchase in goods and services in the 1990's. Therefore, ... no REAL profit was realized either from the banks nor the purchase of the rifle. Both had approximately the same purchasing power. This is inflation. Although we still have inflation today, ... the banks and governments have not addressed the issue, but rather kept interest rates low. In Canada at least we have bank investment interest rates as low as 1.5 % per annum which in no way keeps up to inflation. What it does do is give banks the opportunity of making enormous profits ( Royal Bank of Canada made 7billion 500 million in PROFITS last year ) while the majority of Canadians due to both inflation and higher taxation had less disposable income.

 

Less disposable income translates into fewer buyers of nihonto, kodogu, and any other collectible or non necessities of life. The result being that only the very rich feel secure enough to indulge their love, ... and they traditionally buy only the best. Consequently the value of lesser Nihonto, Kodogu, etc fall in price as fewer collectors have less disposable income.

 

Now some might say, ... well now is the time to buy, ... but truth be known few young people have the security, nor the disposable cash to make purchases right now. Will things turn around, ... I have my doubts. As governments the world over are burdened with ever increased deficit spending the future is not bright. If one looks at the Stock markets, ... we see the same ... over-valued companies, ... and instead of sustainable growth rather we see an unprecedented bull or bear market where speculators are manipulating what investments the average investor makes being sucked up by huge financial institutions.

 

If you Justin had wanted a good investment by buying tosogu, .... you missed the boat by about 40 years, ... and even then you would have barely kept up with inflation and the devaluation of currency.

 

No, ... one buys collectibles the same way as some people buy a pint of beer, .... to be enjoyed now. The only advantage over your tosogu will be that you have the tosogu to look at in the morning long after you've pissed the pint of beer down the lou.

 

... Ron Watson

[Alex A]

Il drink to that, im off down the pub :D

 

Alex.

[christianmalterre]

no further comment needed i think.

Honest and Point answer Ron

me do think equal.

(you but know of course-knowing me and mine collection pretty well!)

 

(You shot the Blackbox as we used to call it those days...)

 

Christian

[Alex A]

Off topic, but a wise investment, don't laugh.....meteorites...

 

Edit, jeeze, first pint was strong lol

 

Alex

[Justin]

Thanks for the great comments. As stated above I don't buy tosogu for investment purposes. I buy to study, appreciate and enjoy.

 

Please keep posting if you have any further info or examples sold in the past that have resurfaced.

[Tcat]

Hi Justin, the question of investment is a complicated one and as posters commented tends to be in a constant state of flux related to vogue, national and international economies etc. I think in the long run 'high-medium' to high quality nihonto and tosogu will always have a market, unless there is some kind of armageddon. Two things currently control the price of Nihonto - 1 The Japanese economy, 2 Collector interest outside of Japan. These two factors operate in very different ways, however I think that the high-point for Nihonto in general as seen in the 80s won't be experienced again in our lifetimes; though it may increase somewhat from its current point.

 

My anecdotal experience says that you certainly can't rely on ANY one piece to increase in value relative to the national/international economy within a hypothetical time period, even the so called best pieces. Far safer is to snatch true bargains when you see them then sell them on in another capacity. Quickly if possible.

 

I have "collected" and sold a few fittings over the last 5 years in a hobby-like endeavor. A handful of tsuba, a few kozuka, a wari-kogai, an iron kojiri spring to mind. A small number of medium quality/low priced items. Everything I have sold has generated profit, I purchased at what I considered low/bargain prices then sold through a dealer with pricing on his advice; after his very modest cut I still had +15-20%.

 

What I am about to say flies in the face of conventional wisdom and I am preparing for a flaming but here goes... :lol:

 

Everything I sold for a profit was sourced from Ebay.

 

 

I wouldn't really say this was a time efficient profit process though, at all, in terms of the amount of time I spent trawling 'investable' ebay tsuba compared to the amount of money I made. I learned a lot, however. My most recent successful purchase was a momoyama tsuba I found on ebay, I paid about 550 USD for it with shipping from Japan and sold it in London for 550 GBP. I think really this was only profitable because I got a deal on the purchase and it was bought in dollars then sold in pounds. Perhaps most importantly, the dealer is a good guy. Another thing I should probably add is that I hand delivered all items to the dealer and on average each took about 2-3 months to sell.

 

I don't have much to add except for that it is very difficult to make any money at all when buying from large established sources eg: auction houses, any brick and mortar dealer or the larger online dealers - unless they miss a trick. The way these guys make money is to buy low and sell high. That really is the only way to make a business out of it. Buy high and sell very high doesn't usually work. You have to get a good deal initially and then be on the ball for your resale.

[Pete Klein]

HECTOR

Brother, she is not worth what she doth cost

The holding.

 

TROILUS

What is aught, but as 'tis valued?

 

HECTOR

But value dwells not in particular will;

It holds his estimate and dignity

As well wherein 'tis precious of itself

As in the prizer: 'tis mad idolatry

To make the service greater than the god

And the will dotes that is attributive

To what infectiously itself affects,

Without some image of the affected merit.

 

Bill S.

[drbvac]

Considering the mark ups on collectibles where you sell to a dealer for half and pay double there is a long - very long time for any returns UNLESS you find a treasure and pay next to nothing for it.

 

I buy what In like - intend to enjoy for my lifetime and if my children don't want them = hope they can get what I paid for them - that said the stock market is no good either

[seattle1]

Hello:

This is actually a very interesting thread, one that ought to be aired more often, and it is a question that is entirely general for any tangible non-income yielding asset. The cautions and warnings given by most posts are basically good advice, but people usually have to learn those lessons from personal experience at the school of hard knocks. Having been a tenured professor of the dismal science for some decades - now retired - perhaps a little buttressing might help.

For financial assets a gain over time comes by an appreciation of that asset (we will avoid the very real and substantial issue of making inter temporal comparisons in real purchasing power terms, usually a very important issue when viewing a return over more than three or four years), by way of an appreciation of its value, or a given value, times the prevailing applicable interest. Now any asset's return must be considered relative to the risk attached to it: that is the story of government debt, hardly risk free, in comparison to "junk bond" debt, which is yet more risky. No art object - rare book, painting, tosogu, sword, etc. - yields interest, therefore its return over time is a function of a change in its value. If it is only dollar considerations that matter, the problem is simple. A tsuba could be compared with a share of non dividend paying stock of equal risk, however all art objects also confer psychic income, the pride of possession, therefore if the hypothetical tsuba in equilbrium yielded a return identical to the non-dividend paying stock, some of that return would have to come as psychic income as the stock yields no psychic income. Therefore, risk adjusted, the tsuba would yield a smaller dollar return. The conclusion is, risk included, tangible art object assets yield lower returns in equilibrium in dollars that do non-aesthetic tangible assets. That is not to say that changing market determinants cannot deliver high returns to Japanese samurai arts, as surely happened some decades ago, or Korean arts a few years later when the Korean economy boomed, or Chinese art today, but when adjusted for risk - the essential point - the dollar return will be less. By the same token, the sum of dollar value plus psychic income can fall with time, either through value decline alone or changing psychic enjoyment from possession. For a more detailed analysis, see, "On Investing in Japanese Swords", Randolph B. Caldwell, Editor. The Book of the Sword. Dallas: 1972.

Arnold F.

[Alex A]

Brian, a fitting thread for the caption above your name, the last time i noticed it was when i was in the middle of buying my last sword, kind of had me concerned lol, had visions of me living in a tent, with 5 full sword racks and a scruffy dog :D . For some people collecting anything to do with nihonto is an hobby, to most though, a luxury.

 

Alex.