A Timely Question – how can I invest in luxury watches?


by CHRONEXT

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A beginners guide to investing in fine timepieces

July 24. 2019 - by CHRONEXT

Are you ready to enter the world of timepiece investing? We sat down with Michael Brückner, a passionate watch collector , author and expert in watch investment and gained some insights into the topic. CHRONEXT is excited to present you with the top tips to keep in mind when looking to invest in watches.


If time is money, invest in luxury watches!

Let us start off this article by defining what an investment watch is. An investment watch is one that retains its value or increases in value over time. Take the Rolex Daytona for example. There was a time when Rolex could not sell these watches for the life of them. Models would sit on shelves for years without being sold. Today, specific Daytona models, such as the 6239 and 6263, fetch prices at auctions well into the million-dollar mark offering a huge return on investment for the owners of these collectible pieces. So what makes a good investment watch? And what features should you look out for when considering purchasing a watch for investment purposes? We answer these questions in depth in this edition of A Timely Question.

Our top 9 tips for investing in fine timepieces

1) Invest in something that you’re interested in

People purchase luxury watches for several reasons, but in general to own and wear a timepiece that means something to them. Being interested, passionate, or even just liking the brand or watch you’re looking to invest in is an important factor. As long as you follow this initial important step, the rest of your investing endeavours will come easy. And if for any reason, your investment watch does not increase in value over time, at least you’ll be in possession of a watch you can enjoy.

2) Interest, inform, invest – 3 simple steps for successful watch investments

What’s the secret recipe for choosing the right watches for a profitable investment? Well, it’s quite simple. As we’ve said, an interest in watches is a good start, because if you find the topic dull you’re unlikely to want to research the required material.

The highly collectible Patek Philippe Nautilus 5711

That brings us to the next point. You will need to inform yourself. Focussing on one topic or brand is usually a good bet, as you don’t want to spread your knowledge too thin. It’s being meticulous and knowing the small details that will set you apart from other buyers.

3) Look for watch brands that are in high demand

A modern classic: The Rolex Daytona

When looking for a watch that will retain its value over time, it is evidently important to look to the past and evaluate brands that have continued to perform throughout generations. It is well established in the watch world that the brands Patek Philippe and Rolex are two safe bets, as they’ve tended to retain value over other brands. These are highly prestigious companies with strong demand for their timepieces. You’re sure to always find somebody who will want to buy a watch from these brands.

4) Look for specific models with unique features such as special dials

Yes, there are certain brands that offer a sounder investment choice.

Here’s a good recipe to follow: an interesting backstory, a unique dial or other characteristic, and small production number. Having all of these can greatly increase the value of a watch.

The chapter rings on the dial of this Rolex Daytona have evolved into chocolate brown

One example of watches with special dials are the Rolex Daytona “Patrizzi” models, which are particular reference 16520 Daytonas that actually have a defect causing a discolouration on the subdials. This has increased their price manifold. You can read more about the “Patrizzi” in our article about the Top 5 Daytona Facts.

5) Mechanical watches make better investments than quartz watches

A fact is, that in the world of horology, mechanical watches are generally more desired than those with quartz movements. So it is no wonder that when looking for an investment timepiece, you’ll have better luck with mechanical watches.

A look into the movement of the Patek Philippe 5270

You may find some quartz watches which have risen in price over time. There is always an exception to the rule, but you will find that those instances are quite rare. When shopping around for newer watches though, you will want to stick to those with mechanical movements.

6) Limited edition watches can yield short-term profits

Some limited edition watches can even bring in short-term returns. For instance, bronze Panerai models have shown rapid increases in price. Other examples of watches that have shot up in value are the Omega Seamaster 300 “Spectre” or the Omega Speedmaster Snoopy. Indeed, the law of supply and demand works the same in the world of watches! It isn’t always easy to get your hands on a limited edition model. It definitely isn’t unusual for them to be sold out before they hit the stores and to get one you’ll need to be on the waiting list for the watch.

The Omega Speedmaster Silver Snoopy Award is limited to 1970 pieces

7) Purchasing from a trusted and secure source on the pre-owned market

The time to invest in a pre-owned watch is now, with the market growing at a nice pace over the years. When looking for a watch to invest in, you shouldn’t limit yourself to new models. A certified pre-owned or vintage watch can make just as good as an investment, if not better. But the market for vintage timepieces can be filled with landmines. Often you’ll find ‘Frankenwatches’, meaning that they have had parts exchanged, often unbeknownst to the next owner! Of course, once no longer in its original state, a watch can lose a lot of its value. That’s why one should be careful and buy from a trusted source.

To offer you security, CHRONEXT has eliminated any risk for their customers by having an in-house atelier with expert watchmakers who thoroughly inspect every single timepiece that goes in and out. Each watch on our site comes with an exclusive CHRONEXT certificate guaranteeing that it is genuine and providing an additional 24-month warranty.

8) Don't spend more than 10% of your investment capital on watches

Here’s a quick tip: You should look to keep capital allocation into watches at a certain level. A rule of thumb is to allocate not more than 10% of your investment funds to watches. Why? Diversify, reduce risk, and enjoy the returns!

The Patek Philippe reference 5270 commands a high price

9) the importance of the right care for your timepiece

One factor people often overlook is the cost of storing their watches. In addition to the maintenance, you should think about investing in a heavy duty safe at home.

Regularly servicing your watch is an important step to keep your collection in pristine condition

SOME INFO FOR YOU VINTAGE LOVERS

Let's take a look at vintage watches as an example. Those who bought the Rolex Submariner Reference 5513 and the Rolex GMT-Master Reference 1675 7 years ago (2012), can now enjoy an investment return of up to 125% for the 5513 and up to 150% for the 1675. Rolex sports models made of stainless steel have been booming for years, and pre-owned watches are no exception.

Source: Rescapement

So... is the watch industry the right place for your investment?

If we can leave you with a concluding statement, it would be to only get into watch investments if timepieces are your passion. Everyone in the industry agrees that buying a watch should be first and foremost for the enjoyment of the watch itself. Evidently, the watch market partly operates on an emotional level, which is why there is no precise formula for investing in timepieces. What are your thoughts behind watches and investing? 

CHRONEXT

by CHRONEXT

Watches are our passion – we start every new day with this philosophy driving us forward. From brand stories to watch technology – we cover every topic imaginable in the world of watches. Our editorial team is constantly searching for new and exciting stories. Looking to introduce your watch collection? Or are you a blogger simply considering cooperation opportunities? Write to us at editorial@chronext.com.

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Providing excellent customer service is one of our top priorities. We deliver your watch fast and with utmost attention to detail. Should you be looking for a specific model which is not in stock, we are happy to source it for you - free of any extra charges. If you would like to sell a watch, our experts will advise you on market developments and the ideal selling price for your timepiece.

Should you have any questions regarding delivery, price or history of a specific model, your personal advisor will be happy to help at any time.

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We always guarantee a safe transaction. When you buy or sell a watch on CHRONEXT, your contract of sale is made directly with us. We take legal responsibility for every transaction and provide the highest data security standards, secure payment methods and fully insured shipment. In order to ensure the authenticity and quality of all watches sold through us, every timepiece is thoroughly checked by our watchmakers before it is ever shipped to our customers.

This is guaranteed through our Certificate which you will receive with the purchase of any watch from CHRONEXT - new or pre-owned.

Fair Prices

Only the best is good enough for our customers. This goes for prices just as well as for service and security. Luxury watches are hardly ever cheap but there are still significant differences in price levels depending on where you shop. Thanks to our vast global network of suppliers and our low fixed costs, we are able to provide competitive prices at all times.

We scan the market daily for the best offers and always keep our prices up to date. Most important however is that our competitive prices will never lead us to compromise security and quality.

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