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What to look for when investing in luxury watches?
Brands like Rolex, Patek Philippe, and Audemars Piguet have shown the potential for appreciation over time. Even other brands like Omega, Panerai, and Cartier have proven to be capable of storing value, based on limited editions or iconic models.
Given the right conditions and proof of authenticity, an investor needs to consider several factors before investing in a watch. Scarcity, uniqueness, craftsmanship, brand legacy and iconic status make a watch a desirable investment asset. It often takes time and a combination of these factors for a watch to rise in value.
Scarcity is at the top of the list of factors to consider. A mechanical watch produced in low amounts and for a short period of time may appreciate in value over time. This is especially so when the watch has a story to tell, it has iconic status, as well as brand legacy. Take the Jaeger LeCoultre Geophysic, for example.
Jaeger LeCoultre Geophysic 1958
Created in 1958 for the International Geophysical Year, only 1300 pieces were produced over the span of a single year. The Geophysic was designed to resist magnetic fields of up to 600 Gauss and featured a water resistance of 100 meters. It was indeed an innovative watch for its time. (see Fig. 3)
Watches with a high level of mechanical artisanship, a high quality in their finishing, decorations, and materials used are also in high demand as investment assets. Craftsmanship is a resume of the watchmaker’s know-how and exceptional craftsmanship will make a watch rare and exclusive.
The value of a watch is also inherent in the technical complexity of its movement. A watch that combines unique horological know-how, brand legacy, and scarcity will be highly rated by investors.
IWC “Il Destriero di Scafusia” (photo courtesy www.collectorsquare.com)
One such watch is the 1993 IWC “Il Destriero di Scafusia”. It features four highly complex complications: a split-second chronograph, a perpetual calendar, a flying tourbillon, and a minute repetition(8) (see Fig. 4). Its movement consists of more than 750 components.
Nevertheless, not all luxury watch models will appreciate in value over time. Some models in fact may even lose value in the long run. Investing in luxury watches requires careful selection of brands and models based on painstaking industry and market research.
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