Painting Alpha

Arnaud Castillo1,2, Douglas Bruce3 and Louis Houseman4

October 2026

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Abstract

What determines the price of an artist’s work? We estimate a hedonic model of average price per square metre for 2,278 artists, using factors that describe an artist’s legacy: museum exhibitions, gallery representation, the auction record and conditions of sale, and a curator-style assessment scored by large language models. Without supplying realised prices or price levels to the models, these factors explain about 72% of the cross-sectional variation in log price.

We interpret the residual as the artist’s alpha: the part of price that legacy, the record and the conditions of sale do not account for. A positive alpha means price has run ahead of what an artist’s legacy supports; a negative alpha means it lags behind. In a single cross-section, alpha cannot be separated into noise and genuine value not captured by the model, which makes its persistence over time the natural object of future work.

ln(Pi) = β0 + Σ βkFik + εi Price per square metre of artist i’s work What legacy, the record and the conditions of sale predict What they don’t: the artist’s alpha
The factors explain about 72% of price differences between artists. The remaining 28% is where alpha lives.

Cite this paper

@techreport{castillo2026paintingalpha,
  title       = {Painting Alpha},
  author      = {Castillo, Arnaud and Bruce, Douglas and Houseman, Louis},
  institution = {TheArt.fund},
  year        = {2026},
  month       = {oct},
  url         = {https://www.theart.fund/research/painting-alpha}
}

This paper was prepared for TheArt.fund, which invests in artworks. The views expressed are the authors’ own and do not constitute investment advice.

Corresponding author: info@theart.fund