Much like the rest of the world, the roaring luxury watch industry was expected to be temporarily silenced by the pandemic’s recession. However, in May ‘20, we witnessed an odd boom in demand for vintage luxury watches – followed by newly launched sustainable models and then regular catalogues. This spawned a helix arc for the luxury watch world, as Deloitte observes industry exports to be just shy of CHF 25 billion in 2022.
After the pandemic’s rude awakening that life is fleeting and expendable, luxury watch buyers are now significantly less reluctant to splurge on desired wish-list items. Or perhaps the congregation saved enough dough during WFH season as they cut down their hedonist spending. Either way, the rulebook for spending on luxury watches has evolved in contemporary times – buyers are younger, investment-driven yet pleasure-bound, equipped with internet libraries, and simply, an I-want-what-I-want approach.
If you’re reading this and starting to relate, you’re probably in the market for a new luxury watch too. To uncomplicate the affair and help you gain a clear sight of your priorities, we’ve penned down a contemporary guide to luxury watch investing.
What Factors Influence Returns?
Before we jump into specifics, let’s think macro.
There are tons of factors that could influence the value/return value of a timepiece – most of which can be determined during the research phase itself. To begin, thoroughly examine the timepiece’s condition followed by in-depth research on market reputation and demand. Next comes the rarity of the timepiece and the unique materials it bears. The value of the watch also extends to its accompanying documentation and its maintenance track record. To get an understanding of how past or similar models from the brand perform, check their historical performance on platforms like WatchCharts, Chrono24 and Everywatch. Finally, notable collaborations could also add a smidge of value.
The Big-League Heroes
Historically, Rolex, Patek Philippe, and Audemars Piguet have been regarded as the holy trinity of watch collecting. For Rolex, we’d put our money on Daytona, Submariner, or GMT-Master II models – which command eternally growing value due to their rich heritage and pristine resale track record. On the other hand, for Patek, the luxury sport Nautilus and Aquanaut models are top-tier. Finally, for Audemars, it’s the one-and-only Royal Oak – their most popular range, including Offshore and Complication models which are bullish in the market.
But well, getting your hands on new-gen Daytonas or high-complication, ultra-limited edition Pateks is – to put it simply – a dream. Interestingly, in recent years, what used to be a trading back-lane has now turned into a thriving global marketplace for pre-loved/owned timepieces. We’ve seen tons of ‘80s and ’90 novelties being made more accessible than ever before thanks to this secondary market. That could be an interesting starting point if you’re not keen on joining a waiting list for current-gen models.
Relics of the Past
Scroll through any watch tabloid today, it’s almost impossible to miss revival launches of retro icons. These blasts from the past have turned into icons on arrival, reigniting its vintage charm and allowing new-generation watch collectors to embrace it. Bulgari’s new ‘Bulgari Bulgari’ from the ‘80s is the most recent of this trend, alongside the Tissot Sideral (1971) and Rado Anatom (1983). Not just models but brands themselves too are rising from the ashes like Daniel Roth and Gerald Genta, who embrace a design language of their own, backed with signature mechanical feats. – While they’re still in their early revival states with a handful of novelties, I would expect them to pick up pace within the next two/three years – making them quite interesting investment nuggets.
Slices of History
They say you can’t go wrong with the classics – and I most certainly concur this applies to watch collecting too. The legacies of certain timepieces are intricately intertwined with the history of mankind, so much so, that if it weren’t for them, history would’ve taken a different turn. To name a few: Omega Speedmaster, Breitling Navitimer, Sieko Quartz Astron, and Blancpain Fifty Fathoms. Considering their heritage and historical contributions to mankind’s strides, they make for excellent collector’s pieces, commanding great market value. As a watch collector/investor, I wouldn’t hesitate to place a few bets on them.
Big Gifts Come in Small Packages Too
If not for the big-league players and the horlogerie historiques, where else can a watch collector look? Understandably, getting your hands on these big-ticket novelties right from the get-go can be tricky, if not, an irksome wait. So, if you’re ready with your Benjamins, and looking for a safe and sturdy place to stash them – try upper-mid-tier options. Italian, nautical-hearted Panerai Luminors or Radiomirs, a slick IWC Big Pilot or perhaps a Grand Seiko Heritage model from the Land of The Rising Sun could be interesting options. Of course, when picking your model, do your research and pay attention to details and feature options.
(Yellow) Gold is the New Black
The craze for yellow gold watches grew rampantly during the ‘80s and ‘90s – exuding the suave of a Miami Vice or Puerto Rican drug lord with more money than restrains in life. While this lifestyle aspiration catapulted this trend into the mainstream, its flash soon turned tacky – turning the masses’ attention to the polar opposite, white-collar-esque stainless steel watches. Which too, got boring after a point, heading the industry towards subtler red and platinum tones of gold lustre. From an investment POV, gold’s inherent fungible value is a great hedge in a turbulent and tense market. Brands like Bulgari, Vacheron Constantin, Longines, and TAG Heuer have recently caught on to the yellow gold rush – they certainly have my attention in this category.
Special Chips – Mechanical Mastery
Strip down its steel, gold, and precious stones – watchmaking’s mother tongue is its mechanical poetry.
Pushing the limits of micro-engineering is horlogerie’s eternal mission. Bulgari, Piaget, and RM go slimmer – Patek Philippe, Vacheron Constantin and JLC go mechanically extravagant (traditional complications) – Jacob & Co, Girard Perregaux, and H. Moser & Cie offer a modern take on architectural complexity. While it’s easy to lose yourself down this rabbit hole of complications, let me direct you to the ones more accessible than not. Chronographs and Day/Date indicators are great entry-level options. Up the ante and you’ll reach the league of World Timers, Perpetual Calendars, and Moonphases. Top-shelf complications will be Tourbillons, Minute Repeaters, and Planetariums.
The Age of Independent Watchmakers
Major-label watch groups like Swatch, Richemont, and LVMH hold major slices of the market with horological offerings governed by corporate quotas, marketing campaigns, and contractual limitations. However, there are a few folks to approach the industry in a more artisanal, unilateral, or ‘independent’ sense. Simply put, independent watchmakers are those still under first-generation leadership/ownership, who aren’t backed by billion-dollar funding (yet) but still manage to make quite a splash and offer interesting value propositions. While legacy watchmakers boast multi-century lineages, independent titles like F. P. Journe, MB&F, Franck Muller, and Richard Mille, who come with a mere fraction of the same, go head-on in the market. What distinguishes them, is their purist approach towards watchmaking, striving for artistic value, mechanical excellence, and building counter-culture legacies. Exploring the world of independent watchmakers is certainly a worthy trip in today’s investment market – think of it as buying IPOs of new-age, pioneering brands, against investing in shares of older, safer brands.
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