Investing in luxury watches, is it a good investment?
The luxury watch market is not what comes to mind spontaneously for savers and investors. For good reason, it is a niche market, just like gold, crypto-currency, oil, wines or even collector cars.
However, in the context of portfolio diversification, luxury watches have their place, provided you are reasonable and do not leave all your savings capacity there. A pleasure investment that can be interesting for enthusiasts of Rolex, Breitling, Patek Philippe or even Omega…
What is a luxury watch?
First of all, before even thinking about investing, it is good to take an interest in this specific market. A luxury watch is neither a Swatch, nor an Ice Watch, nor a Festina, with all due respect to lovers of these brands.
A luxury watch is therefore not defined by a good produced in large series, with low quality materials, any more than it is defined by its selling price alone.
Similarly, watches from major fashion houses such as Hugo Boss, Dolce and Gabanna or even Guess are not luxury watches, even if their selling price is high.
High-end luxury watches are made in Switzerland and carry prestigious names. They certainly have a high price, but also value, these two terms not being confused under any circumstances.
Thus, luxury watches are worth several thousand euros, even several tens of thousands of euros, and span the ages thanks to their robustness, their noble materials such as gold and platinum, their elegance and their historical charge (aviation , navy, etc).
Why invest in luxury watches?
Investing in luxury watches can respond to a passion, a love of beautiful things, the attraction of a precise and fascinating mechanism. They allow you to highlight your wrist by wearing a jewel, whether you are a woman or a man.
In addition, a high-value watch being a material good, it makes it possible to invest in tangible and useful value on a daily basis. This has a reassuring side, like investing in gold bars, unlike intangible goods such as shares for example.
In the end, it is a safe haven that allows the identity of those who wear them to be affirmed on a day-to-day basis. Their notoriety is known throughout the world and the rating of certain old watches has continued to grow in recent years.
What performance can you expect from a luxury watch?
There are no trackers yet to follow the course of this specific market. It is therefore impossible to invest in watchmaking without owning a watch. You will have to put your hand in the wallet to get a rare model, new or used.
As with stocks, this is a long-term investment. Do not expect to buy a Rolex for 5,000 euros to resell it for 10,000 euros six months later, that would be utopian.
Depending on the brands of the great watchmakers, the condition of the watch (new or used) and its rarity, count between 3,000 and 100,000 euros to acquire a listed model that is easily liquid if needed.
Thus, a well-chosen luxury watch can see its value highly revised over time, provided that it is kept in good use and maintained. This maintenance must take place approximately every 5 to 10 years, and you will be billed several hundred euros.
Ultimately, as you will no doubt have understood, no one can predict the increase in value of a watch over time, as there are so many parameters to take into consideration. An acute knowledge of the luxury watch market will be necessary to make the best deals.
How to choose the right luxury watch?
For your watch to have a chance of becoming a profitable asset, it must therefore be:
- Made by a great Swiss watchmaker
- Regularly serviced with supporting maintenance invoices
- Produced in a few thousand copies only or in limited editions
- Accompanied by a certificate of authenticity
- Equipped with precision technologies thanks to their mechanism
- Steeped in history (like the Omega watch worn by James Bond)
It is better to buy your watch new in an official store, or take advantage of the second-hand market at official auctions, in order to acquire an authentic model. If the market is exciting, it is nonetheless uncertain and should be favored by watch enthusiasts, it is above all a useful pleasure investment to diversify its heritage.