An Improved Plan Of Art Investment Decision Making For Hunan Fine Arts Publishing House

Long-term investment is an important decision-making activity in businessoperation. Whether the long-term investment decision is scientific and correct isdirectly related to the economic return of an enterprise, and ultimately determines theexistence, development and operating strategies of the enterprise. In the case of theinvestment in artworks, Hunan Fine Arts Publishing House (HFAPH) has introduced acomprehensive risk and return evaluation system to implement scientific managementof the decision-making process, boost the long-term investment return, and effectivelyavoid risks for the publishing house's stable and diversified development.This paper researches in the decision-making of the long-term investment inartworks. Firstly, the research background of the long-term investment in artworks isintroduced, and investment decision-making theories are reviewed; secondly, thecurrent state of HFAPH's art investment and the development of art investment atlarge are analyzed, and the problems of HFAPH's art investment are summarized asfollows: institutional investor's cognitive biases and irrational behaviors, the lack ofscientific feasibility study for long-term investment projects, the lack of completeinternal controlling and monitoring system, the lack of strict risk and control systemand other problems; thirdly, this paper constructs2evaluation indices for risk andreturn on the basis of the various factors of long-term art investment. With the indices,Analytic Hierarchy Process is employed to determine the weights for the factorsrelating to risk and return, compute the scores on each factor of the indices and thenderive the final decision on art investment; finally, this paper, based on HFAPH's artinvestments, puts forward an improved technique for long-term investment. This newtechnique for long-term investments involves putting in place reasonabledecision-making procedures, strengthening internal controlling and reviewing,stepping up the monitoring and supervising, setting up the warning mechanism forrisk management, and normalizing the exit mechanism, etc. In employing theimproved long-term investment decision-making technique, risk control must beemphasized, and support must be guaranteed in matters of personnel, organization andregulatory rules.