There are plenty of reasons for people to buy watches — ranging from the practical (i.e. “I’d like to be able to know what time it is, but stylishly”) to the idealistic (i.e. “This watch will be a family heirloom for generations to come”). There’s another reason that can be added into the mix — the concept of the watch as a long-term investment, and one that could outperform more traditional investments, depending on the watch, the dollars put up and the timeframe in question.
As with nearly everything about investing, though, things can get complicated very quickly. And, as Joseph Wilkins recently wrote at Insider, the last year has been a challenging one for some investors looking to cash in on a luxury watch in the secondary market.
Wilkins analyzed data from the Watch Market Index, which tracks fluctuations in the prices of a host of luxury watches across the past few years. He notes that the overall index peaked in March 2022 and has dropped 32% since then. He cites both higher interest rates and issues with the crypto market as reasons for this.
That said, investing isn’t always about the last 12 months or so, and a look at the Watch Market Index since early 2021 shows a value off its peak, but overall remains significantly up from that point.
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A look at changes in the market over the last six months also reveals further complexities in the small details. Prices for some luxury watches have dropped in that period, while others — ranging from a Patek Philippe 5712/1A to a Breitling AB0127 — show growth.
In the end, buying a luxury watch comes back around to a key question: what’s the main reason that you’re buying this? If it’s with resale in mind, Wilkins’s article offers plenty to think about. But it’s also worth considering the long game.
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