Depending on the brand you choose, some watches can be classified as a ‘good’ investment. However, like all investments, there are several factors to consider, such as the potential depreciation in the price of the purchased watch.
Here are some rules to adhere to when considering watch investments:
Rule No.1 - Stick to Your Budget
The primary rule when investing in watches is to adhere to your budget and try not to exceed it. The more you spend, the higher the risk of financial loss.
If you can comfortably afford to invest £10,000, limit your spending to that amount. If stretching your budget could cause financial strain, reconsider your investment strategy.
It’s advisable to reserve the funds for the desired watch and wait for availability rather than financing the purchase and accruing additional costs through annual percentage rates (APRs).
Rule No.2 - Select the Right Brand
Not all watch brands are equal. While there exists a certain level of snobbery surrounding watch brands, it’s an undisputed fact that some brands are more collectible and sought after than others.
This doesn’t necessarily make them superior, but it does increase their investment potential. Among the top brands offering investment potential are Rolex, Audemars Piguet, and Patek Philippe.
Rule No.3 - Choose the Right Model
After determining the brand you prefer, it’s crucial to select a model that has a high likelihood of retaining or increasing its value. However, this decision is heavily influenced by market trends. What’s popular today may not hold the same appeal in six months or a year.
As of 2024, the most sought-after models include the Rolex Submariner, GMT Master 2, and Daytona; the Audemars Piguet Royal Oak; and the Patek Philippe Nautilus and Aquanaut.
Rule No.4 - Choose Your Desired Specifications
Within each model, various characteristics differentiate one watch from another. These include the type of metal used, which can range from steel to gold or platinum, as well as the bracelet variations, such as different styles or materials like rubber.
Most importantly, consider the dial variations. When contemplating a watch purchase with future investment potential, pay close attention to the dial, as it is the most unique and sought-after feature.
Popular dials often feature bold colors or rare materials, setting them apart from more conventional counterparts. These distinctive characteristics make them highly desirable to collectors and enthusiasts alike.
Rule No.5 - Always Purchase Something You Like
While it may seem obvious, many individuals find themselves swept up in the allure of luxury watches and make impulsive purchases without considering their personal taste. Investing in a watch that you dislike or find uncomfortable to wear can lead to disappointment and financial loss in the long run.
A final thought
Like all investments, the value of watches can fluctuate, sometimes rising and sometimes falling. It’s essential to understand that while watches can be viewed as long-term investments, conducting thorough research is crucial when purchasing luxury items. Ensuring the legitimacy, authenticity, and solid provenance of the items is advised.
As a watch collector and enthusiast, I’ve come to accept that the value of my collection might not equate to half of what I initially invested in it, and that’s perfectly fine with me. Each watch in my collection holds sentimental value, telling its own unique story of why I acquired it. To me, watches transcend mere investment—they represent a beloved hobby that I share with friends and fellow enthusiasts worldwide.
To help retain your watches value check out our article: 7 tips to retain the value of your luxury watch