Why You Should Invest In Watches

I have consumed hours of watch content on YouTube and read countless articles.
I’ve listened to different peoples opinions whether it’s a good idea to think of watches as investments and whether it’s a good idea to invest in watches or not.

Is it safe? Or risky? Wise? Or foolish?

Well, I’d like to share my thoughts...

If you are thinking about investing some of your money and want to know WHY investing in luxury watches is a good idea, I’ll share my top reasons why. I’d like to say that I do honestly feel that first and foremost luxury watches should be enjoyed, appreciated and respected. They are items that should make us happy. In fact, I am quite heavily against watch-people that exclusively see watches as dollar bills and pound notes. But that said, I also do feel like watches can make great investments for all the reasons I will mention.

What I personally endorse, is that genuine watch enthusiasts who have a passion for watches, can also make money through buying and selling the right watches. They are interested in watches, so it’s an enjoyable process for them and not a cold, ruthless, emotionless, transactional, money making vehicle. It’s investing with genuine enthusiasm and knowledge.

Both the primary and secondary watch market is booming at the moment and growth is expected to continue. As the investing market continues to grow, limited supply paired
with growing demand for luxury watches, has resulted in rising prices and increased trading activity on the secondary market. Prices of certain luxury watches have gone up significantly over the past few years, so watch lovers and speculators are starting to increasingly consider watches as an alternative form of investment.

The way I see it – there are two pillars of watch-buying.

ONE that is the buying of watches that are owned, cherished and kept. THE OTHER is watches that are purchased with investment in mind, and that can either be enjoyed and worn – or popped away for safekeeping (depending on the watch).
I do know of people that buy two of an investment grade watch. One to rock. One to stock.

It’s also worth reminding you that not all investors are created equal. One investor may be happy with a few thousand pounds of return every few months. Another may not bother getting out of bed for less than a million pounds of return.

Firstly, just for good times sake – let’s define “investment”.

What Is An Investment?

Investopedia says, “An investment is an asset or item acquired with the goal of generating income or appreciation. “Appreciation” refers to an ‘increase in the value’ of an asset over time. When an individual purchases a ‘good’ as an investment, the intent is not to consume the good but rather to use it in the future to create wealth. An investment always concerns the outlay of some capital, today—time, effort, money, or an asset— in hopes of a greater payoff in the future”.

Is it possible to buy a watch as an asset and sell it one day for a price that is higher than what you paid? Of course it is. Watches potentially could be good investments. However – First and foremost we must all respect the fact that the vast majority of watches will depreciate in value. Only a handful of models from well known brands could be deemed ‘investable assets’. Likewise, as with any investment, it is not possible to predict how the market will develop in the future, but we can of course take a look at prices over the past years.

Here are my reasons WHY I think it is a good idea to invest in watches.
I must advise that I am not a financial advisor or investment specialist. But I am a watch professional.
These reasons are just my thoughts and opinions based on my personal research experience.

Why You Should Invest In Watches Prestige Watches

Number 1 – You can make good money if you buy and sell the right watches.

It’s a bit of a no-brainer. It is possible to make money in the short term and the long term IF you know what you are doing. That is buying the right watches for the right price at the right time. I have countless case studies, where customers of mine have made money with watches and, where I have made money with watches. We are seeing watches from some brands, mainly stainless steel sports watches from Rolex, Patek and Audemars Piguet selling at 30, 40 or 50% over their RRP (recommended retail price).

A new watch selling on the secondary market for DOUBLE its list price is kind of insane.
Some vintage watches are flying high also. But the truth is, there are lots and lots of other watches out there that could also make you money. Maybe not as much as the headline-making styles, but still good money. Brands that you may not think of like Lange, Jaeger Lecoultre, Heuer, Cartier, Bulgari, Omega, Longines, Gallet, Universal Geneve. The list can go on and on.

Remember you are buying to one day sell at a higher price. Buy the wrong watch – and its game over. You’re taking a bath. Or, even if you buy the right watch, but in the wrong condition or for the wrong price, you’re taking a bath.

A few years ago, I sold a watch to a customer for £5,000. That watch is worth £9,000 or even £10,000 today. But the incredible thing isn’t the amount of money he made.
It’s the fact that he made it while wearing that watch almost every single day.
Looking at all the watch dealers, flippers and collector-sellers out there profiting from the sale of a watch each time, how can it be anything other than a good idea?
Lets not forget, the price of a stainless steel Rolex sports watch has never gone down in price. Only up. On the flipside, I have people coming to me asking to sell their watch for them HOPING they will make money on it. But guess what, wrong watch at the wrong time. They’re making a loss unfortunately.

Number 2 – It’s fun.

If watches are your thing, then why not enjoy them and make some money at the same time.
The goal of an investment is to make money, but if you’re interested in watches it can simply be more fun to invest in (and wear) a watch than it is to invest in crypto currencies or stocks and shares for example.

The deep research., the hunting, the acquisition, the buying and the wearing. It is an enjoyable process. You get the experience of wearing cool, amazing watches, while also enjoying the benefits of an appreciating investment.

Number 3 – Watches are timeless design and high quality assets.

Even with the ability to tell time on your phone, luxury watches have always proven to date, for the last century and a half – that they will never go out of style. They are an achievement to those that collect them, and an icon to those that wear them. With the ability to transform those that own them. Luxury watch brands have become timeless.
Prestige brand watches are built to last. Many of the luxury watches on the market are built by hand, or using a balance between traditional techniques of expert watchmakers and modern technological innovations.Swiss made watches have long been considered the premium watches among luxury designers and watchmakers. Switzerland has long been home to master watchmakers, and that “Swiss Made” label is hard-earned.
For a watch to be produced with the Swiss Made emblem, it must have been assembled in Switzerland using high-quality, handmade movements also crafted within Swiss borders. Every piece is inspected for quality before the label is applied. The methods used ensure precision and longevity. Consider the fact that the origins of these timepieces predate batteries and industrialisation.
Some watch brands are among the most well known brands in the world.
Starting with, no surprises Rolex. It has survived for over 150 years. This includes several economic downturns and each of those years it has grown stronger and more sought after.
In 2021 Rolex was voted the worlds number 1 Superbrand on the Superbrands list.

Longines is the oldest, unchanged registered trademark. And we can not not mention household names like Omega, Cartier, Patek Philippe and many others.

Number 4 – It’s a portable asset.

Unlike cars or buildings or big works of art – because of their small size, a watch can go where you go and be sold relatively quickly – anywhere at any time.
You can enjoy wearing it and using it in just about every walk of life and still make a profit from selling it. It’s easy to show the asset to any buyer, potentially making it a faster moving investment.

Number 5 – A luxury watch will help you stand out. It’s a conversation piece.

In an era where, thanks to mobile phones and smart watches, there’s no need to wear a traditional watch, doing so can mark you out as someone with distinct values and qualities. People who wear nice watches are thought to be more conscientious and, wearing a luxury watch can have such a significant impact on people’s impression of you that there are companies who rent out high end timepieces to members for this very purpose. People’s first-impression perception of what sort of person you are, is made almost instantaneously, without even speaking a word to you. When they notice your dress style, your shoes and hopefully your choice of luxury timepiece on your wrist.
Also if you meet another watch enthusiast – it can form a bond and create conversation. I can spend hours talking about watches with friends and family. And I know a lot of other people can too. I bought a watch from a gentleman the other day and he was a salesperson of high end cars. Not only did he say he enjoys talking to customers and prospects equally as much about their watches as he does cars, he ALSO says he uses watches as a way of getting to know customers and prospects, forming bonds and making great conversation.

Why You Should Invest In Watches Prestige Watches

Number 6 – Other investment opportunities have higher risk.

All investments – including traditional ones like stocks, shares and Crypto markets have a risk of going down and crashing. They are and can be volatile. While an investment watch only goes up in value over time making them a steadier investment than most digital assets.
Buildings and cars have a built-in depreciation value that the right watches don’t have.
Investing in the stock market? Personally I believe it’s a little overrated. There’s a whole world of alternative investments out there and watches are one of those alternatives. Watches exist in a more stable market. The value of a watch is highly unlikely to fluctuate like the price of a stock (apart from super-hyped watches that come along every now and then). Specific watch brands and models can appreciate over time and generate returns that exceed the stock market.
Over the last decade or so, the vintage watch market has ballooned. Collectors are willing to pay high prices for sought after vintage watches from a wide variety of brands.

Number 7 – The value of an investment watch only grows as it gets older.

Luxury watches have potential to increase in price just with the passing of time. There are various reasons and explanations for this.

Watches have a built-in historical value that makes them increase in price as they get older.
It’s like a fine wine that only gets better with age. The older a watch is the higher in value it gets. Watches have been collectors items long before many other investment vehicles were even invented.

Number 8 – You can pass the investment piece down to the next generation.

A nice benefit of investing in watches is that they’re physical assets. Investing in your future is important but investing in your kids future is also important. A watch that can be handed down from generation to generation is a great investment for your younger loved ones.
A luxury watch will not only last your entire life – but the lifetime of your little loved ones too.
It is truly a generational investment and is great as a family heirloom.

Number 9 – There are new potential investment luxury watches created every year.

Watch brands continuously create new luxury watches and anyone of them can instantly become a collectors item. When a watch brand releases a new watch it is like new stock has been listed on the exchange. With the right watch, the value will start increasing from the moment it is placed on the showroom floor.

Although, kind of counter intuitive, the opposite of a watch brand releasing a new watch creates value too. When they discontinue a watch, this will cause the watch to increase in value because all of a sudden its numbers are finite. This creates rarity, scarcity, interest and demand, pushing prices up.

Number 10 – The time to invest is now.

The economy is about to rebound from the past years of the pandemic. The high street will rebuild and start getting back to the new normal. Travel is easing up after the pandemic and events and shows are back in the diaries. Sentiment is improving and I believe the markets will begin to ease and lose some of their volatility. This is a great time to start investing in alternative assets like watches.

In a world where so much is digital and non-tangible, physical assets are a nice investment to have. They are a little different, interesting and exciting in my opinion.

While there may be other bigger, more lucrative investment vehicles out there, profit returns on watches is certainly better than keeping the money in the bank.
Back at the tail end of 2019, no one quite predicted what was going to happen right around the corner in Q1 of 2020. The virus delivered us humans a thumping 1-2 killer combo in 2020, 2021 and now in early 2022, it still has us in a choke hold.

I mention this because who would’ve had any idea how this virus would have impacted sales of new and pre-owned luxury watches. Most people would have thought a global pandemic would have dramatically slowed down sales of luxury watches – as people turned their attention to more important things, such as staying alive, keeping loved ones alive, keeping jobs and paying bills…

Why You Should Invest In Watches Prestige Watches

But no…

People were still buying and selling luxury watches. Right through the pandemic.
Things didn’t slow. In fact the figures evidence GROWTH! Make of that what you will.

I would have predicted that in the midst of a global pandemic where people are dying, sales would have dropped. And they didn’t.

But they COULD HAVE. And millions of people could – potentially – have seen their prized assets depreciate. And they didn’t.

Instead we have seen record breaking prices for our most wanted watches from our most treasured watch brands.

I can’t think of many instances in life where you can have your cake and eat it.
Investing in watches – you can!

Number 11 – Diversification.

Any banker, financial planner or wealth manager will always tell their clients to ‘diversify’ their investment portfolio. Tangible/physical assets can act as a good hedge against inflation, as well as providing a way to diversify your investment portfolio. This means basically, ‘don’t put all your eggs in one basket’.

If you purchase just one investment and it performs badly, you risk losing all of your money. By adding other investments, you reduce the risk of this happening and hopefully profits from your other investments could potentially offset the loss on a bad one. Therefore, by spreading or ‘diversifying’ your investments across lots of different investment products, such as stocks, Crypto Currencies, and alternatives, as well as different industries and countries, you can lower your overall risk without sacrificing long-term returns.

The main reasons to diversify your investment portfolio:

  1. Gain exposure to a broader set of interesting investments.
  2. Different investments will not all perform well at the same time.
  3. Investments will be impacted differently by external factors, such as interest rate changes, and move in unique ways.
  4. The combined risk of a properly diversified portfolio will be smaller than the sum of the risk of each asset individually.
  5. Undiversified portfolios are extremely risky and you will not be compensated for taking that risk over longer time periods.

Now for my TOP TIP! Number 12!

The key thing when it comes to investing in watches is BUYING THE RIGHT WATCHES.
You must know what watches are good choices so you can sell them in the future for more than what you paid.

I would say there are four levels of investment grade watches.
Low, medium, high and sky high. Some watches you can make a little, a few hundred pounds per watch. Mid level would be several hundred pounds to a few thousand pounds.
High would be £3,000 to several thousand pounds.
And sky high would be a white elephant of a watch you inherited. A Paul Newman Daytona or a Patek Philippe 5711, where we are talking tens or even hundreds of thousands of pounds. This attitude to ‘return’ is also linked to risk – just like investing in low, medium or high risk investment funds.

How do you know what watches are best for you?

My top tip is this: Partner with a pro to help you buy the right watches.

If you don’t know what you are doing, or you are unsure and need guidance, my best tip would be to partner with someone with knowledge and experience to help guide and mentor you through the journey. Even if it’s just for a year or two to help you gain experience of your own and protect you through the pitfalls and perils.

To invest successfully in watches, you need to buy a select choice of strong, asset appreciating watches. Not soft choices that will not gain or worse lose you money.
That selection choice is not small. There’s a gazillion options out there.

You must know what you are doing.

Buying a watch? Selling a watch?

Want to invest & make money?

Before you do anything, you need to read this helpful guide from Marcelo at Prestige Watches.