Watches as a store of value?

[DrFfybes]

A friend has a Rolex, was saying last year how he'd paid £3k (or thereabouts) for it 15 years ago before they started becoming popular again and it was now worth £11k. I asked him how much he'd been offered for it, and he looked blank.

Then he saw an extremely similar one in the window of a Jewellers' for about £10k and out of interest he went in for a valuation, they offered him £5k.

Paul

But his Rolex was used, whereas I assume the one in the Jewellers' window was new.

Both used, same model, but the one in the shop was a newer one.

[stevensfo]

But his Rolex was used, whereas I assume the one in the Jewellers' window was new.

Both used, same model, but the one in the shop was a newer one.

I guess that the jeweller will spend months or years waiting, but when the watch is sold, they've made a humungous profit.

This made me remember when I used to buy GQ and Esquire magazines. What a waste of money. A ridiculously large number of full colour ads were for watches, so much so that they became very boring. I can only assume that, like glasses, the profit margins must be incredible.

Steve

PS Whatever happened to the good old digital watches from the 70s? They were so fashionable once. Well 2 years?

[scrumpyjack]

Well a 50% gross margin is probably about normal for a retail jeweller, so buy at 5k and sell for 10k is not remarkable. It is expensive running a High St shop!

[BullDog]

Both used, same model, but the one in the shop was a newer one.

I guess that the jeweller will spend months or years waiting, but when the watch is sold, they've made a humungous profit.

This made me remember when I used to buy GQ and Esquire magazines. What a waste of money. A ridiculously large number of full colour ads were for watches, so much so that they became very boring. I can only assume that, like glasses, the profit margins must be incredible.

Steve

PS Whatever happened to the good old digital watches from the 70s? They were so fashionable once. Well 2 years?

I'm wearing a Casio F-91W. Genuine 1970's icon and still available new in Argos, Samuel's etc..... An affordable but true classic design icon. IMO of course.

[gpadsa]

A ridiculously large number of full colour ads were for watches, so much so that they became very boring. I can only assume that, like glasses, the profit margins must be incredible.

Much like FT HTSI (of course private eye can never get the letters the right way around) in the run-up to xmas. I do wonder how much value a £200k watch can retain & for how long

gpadsa

[stevensfo]

A ridiculously large number of full colour ads were for watches, so much so that they became very boring. I can only assume that, like glasses, the profit margins must be incredible.

Much like FT HTSI (of course private eye can never get the letters the right way around) in the run-up to xmas. I do wonder how much value a £200k watch can retain & for how long

gpadsa

I remember a watch being advertised in GQ magaizine for a stupid amount of money, with a skull design, that I found horrific and wouldn't wear for any amount of money.

I just found it!

https://www.gq-magazine.co.uk/watches/g ... nders-2021

It's number 15/22.

https://www.ablogtowatch.com/hands-on-l ... ton-watch/

About 450K.

Personally, I'd buy two, just in case I lost one.

Steve

[Bubblesofearth]

I'm wearing a Casio F-91W. Genuine 1970's icon and still available new in Argos, Samuel's etc..... An affordable but true classic design icon. IMO of course.

"Far out in the uncharted backwaters of the unfashionable end of the western spiral arm of the Galaxy lies a small unregarded yellow sun. Orbiting this at a distance of roughly ninety-two million miles is an utterly insignificant little blue green planet whose ape-descended life forms are so amazingly primitive that they still think digital watches are a pretty neat idea."

[BullDog]

I'm wearing a Casio F-91W. Genuine 1970's icon and still available new in Argos, Samuel's etc..... An affordable but true classic design icon. IMO of course.

"Far out in the uncharted backwaters of the unfashionable end of the western spiral arm of the Galaxy lies a small unregarded yellow sun. Orbiting this at a distance of roughly ninety-two million miles is an utterly insignificant little blue green planet whose ape-descended life forms are so amazingly primitive that they still think digital watches are a pretty neat idea."

[servodude]

I guess that the jeweller will spend months or years waiting, but when the watch is sold, they've made a humungous profit.

This made me remember when I used to buy GQ and Esquire magazines. What a waste of money. A ridiculously large number of full colour ads were for watches, so much so that they became very boring. I can only assume that, like glasses, the profit margins must be incredible.

Steve

PS Whatever happened to the good old digital watches from the 70s? They were so fashionable once. Well 2 years?

I'm wearing a Casio F-91W. Genuine 1970's icon and still available new in Argos, Samuel's etc..... An affordable but true classic design icon. IMO of course.

Does admitting this on the web attract the attention of security services?
https://www.watchesofespionage.com/blogs/woe-dispatch/casio-f-91w-the-preferred-watch-of-terrorists

[SalvorHardin]

My main watch is by Burberry Mens Swiss Black. £240 secondhand off Amazon ten years ago.

In the watch world it occupies an interesting place. "Burberry" says "expensive" to most people. But the Burberry watches weren't (which is why they no longer make them). Fossil made them under licence until they were discontinued). Nice but not stupidly priced.

Every time I've taken it to a Jewellers to change the battery there has been a sharp intake of breath on the other side of the counter followed by "we need to check this". Then after consulting their notes, "Oh, right we can do this".

Really nice design, minimalist and takes a surprisingly large amount of punishment. Five years ago mine was hit by a well struck cricket ball whilst fielding at silly mid-on in a veterans game. I caught the rebound. Still keeps good time

[stevensfo]

My main watch is by Burberry Mens Swiss Black. £240 secondhand off Amazon ten years ago.

In the watch world it occupies an interesting place. "Burberry" says "expensive" to most people. But the Burberry watches weren't (which is why they no longer make them). Fossil made them under licence until they were discontinued). Nice but not stupidly priced.

Every time I've taken it to a Jewellers to change the battery there has been a sharp intake of breath on the other side of the counter followed by "we need to check this". Then after consulting their notes, "Oh, right we can do this".

Really nice design, minimalist and takes a surprisingly large amount of punishment. Five years ago mine was hit by a well struck cricket ball whilst fielding at silly mid-on in a veterans game. I caught the rebound. Still keeps good time

A quick look on Ebay and, yes, Burberry do make nice watches, and very affordable.

I agree about a minimalist design. The watches selling for 20K+ in the glossy magazines seem to have small extra dials cluttering up the main dial and just look unrefined to me. The 'loadsamoney' Harry Enfield character comes to mind.

Much prefer a smart watch with a simple dial and date box. One that makes a statement, 'I don't need fancy timers and gadgets. I have staff who do that sort of thing'.

Until someone asks you the time and you say, "Well, Mickey's hand is on the one and...."

Steve

[Padders72]

Well a 50% gross margin is probably about normal for a retail jeweller, so buy at 5k and sell for 10k is not remarkable. It is expensive running a High St shop!

That’s a 100% margin is it not?

[scrumpyjack]

Well a 50% gross margin is probably about normal for a retail jeweller, so buy at 5k and sell for 10k is not remarkable. It is expensive running a High St shop!

That’s a 100% margin is it not?

Margins are usually expressed as a percentage of sales price.

[Lootman]

Much prefer a smart watch with a simple dial and date box. One that makes a statement, 'I don't need fancy timers and gadgets. I have staff who do that sort of thing'.

I agree although I do not need a date box. And the one on my Boccia Titanium watch is always wrong anyway. It is still going strong after 25 years and only one service needed in all that time. It survived me diving into a swimming pool when I forgot to take it off first.

[Johnspenceuk]

Reading this thread was interesting as I have this week sold a Rolex datejust purchased new in 1991 from Laing's in Argyll arcade Glasgow for £1996 (the list was iirc £2499) when I had it appraised I was told had the papers been stamped I could have achieved £4000 however the box and full stamped papers make 25% of the value of Rolex watches. I was offered £2700 from another Argyll Arcade dealer as is (the winder had damage and the bracelet was worn ).
I decided to auction it on Grailzee it sold initially for $4300 unfortunately for me the purchaser did not complete a second auction achieved $3850 which did complete on Thursday 9/11 whether a good or bad store of value, you can decide. I enjoyed wearing it for 30 years, the last two years it lay in a drawer but I'm glad I kept the box etc.

John

[ayshfm1]

A store of value has to be credible. If it's not credible to me it fails the test, I appreciate that this does not in fact not make it a store of value for others.

Watches, I like watches and I've got a fair few, which I never wear, on my wrist is a garmin activity band. I would be in the market for a titanium solar powered (eco drive) quartz diver with sapphire crystal on a Kevlar strap, but I'd probably not wear that either, it would be likely be less than £400 and from a watch perspective would be superior in every way to a Rolex submariner for a fraction of the price. Rolex watches rely on a greater fool and thus fail the store of value test. I use Rolex as an example I feel the same about all the others, though I like them better for the way they showcase the watch makers talent, a Rolex is in reality a mass manufactured product with artificially constrained supply.

Normal sized Diamonds are worthless, they can be manufactured and even if they could not be the market is rigged for the primary suppliers, anyone trying to sell a second hand diamond will struggle to recoup a fraction of what was paid.

Stamps are worthless scraps of paper. I hold the same view on all art, which likely makes me a philistine.

Bullion metal. Attracts VAT which basically kills it.

I don't trust digital currencies, bitcoin is the best but I don't hold any or want to. I especially don't like central bank digital currencies.

Sov's and pre 1947 and 1920 uk silver is worth holding and I have some. Gold and silver are for now limited in quantity and both of these holding entities are recognisable in a worst case scenario and don't have UK tax issues if such a scenario is avoided.

I am in the market for other portable wealth stores though, anything else worth considering?

[BullDog]

I am in the market for other portable wealth stores though, anything else worth considering?

Not until the recently highly inflated asset prices subside. Classic bikes, cars, high end watches, fine wine...... They all need to deflate significantly before they're worth buying. Even then, need to be really selective to retain value longer term. IMO of course.

A 1990's Rolex like mentioned above is regarded as a vintage watch by Rolex. They charge a premium to work on older watches. 3rd party servicing isn't a terrific option because the company will not supply OEM parts. A £3000 watch can easily run up a bill of a £1000 for a Rolex service centre overhaul.

[Lootman]

Sov's and pre 1947 and 1920 uk silver is worth holding and I have some. Gold and silver are for now limited in quantity and both of these holding entities are recognisable in a worst case scenario and don't have UK tax issues if such a scenario is avoided.

I am in the market for other portable wealth stores though, anything else worth considering?

I am with you on gold and silver coins, rather than just coins that have purely numismatic value. Although I have some of each.

Although not that portable if you get into serious amounts, unless you buy only perfect-condition rare coins.

But if you are more interested in portability and anonymity than you are in potential growth, then good old cash takes some beating. A 10-centimetre pile of Swiss 1,000 franc notes worth a million weighs just one kilogram and has a volume of 1.3 litres.

There is a Singaporean note that is worth several times as much, but I doubt that it is as available.

[GoSeigen]

Reading this thread was interesting as I have this week sold a Rolex datejust purchased new in 1991 from Laing's in Argyll arcade Glasgow for £1996 (the list was iirc £2499) when I had it appraised I was told had the papers been stamped I could have achieved £4000 however the box and full stamped papers make 25% of the value of Rolex watches. I was offered £2700 from another Argyll Arcade dealer as is (the winder had damage and the bracelet was worn ).
I decided to auction it on Grailzee it sold initially for $4300 unfortunately for me the purchaser did not complete a second auction achieved $3850 which did complete on Thursday 9/11 whether a good or bad store of value, you can decide. I enjoyed wearing it for 30 years, the last two years it lay in a drawer but I'm glad I kept the box etc.

At 2.5% CAGR obviously an attrocious store of value given that undated gilt yields were around 10% at the time; Your £2000 invested in gilts would be worth some £16000 today and buy you four of those Rolexes. Although anecdotal, it's a useful cautionary tale, and one I will bear in mind as I have been buying some art as a "hedge" myself.

GS

[Johnspenceuk]

Reading this thread was interesting as I have this week sold a Rolex datejust purchased new in 1991 from Laing's in Argyll arcade Glasgow for £1996 (the list was iirc £2499) when I had it appraised I was told had the papers been stamped I could have achieved £4000 however the box and full stamped papers make 25% of the value of Rolex watches. I was offered £2700 from another Argyll Arcade dealer as is (the winder had damage and the bracelet was worn ).
I decided to auction it on Grailzee it sold initially for $4300 unfortunately for me the purchaser did not complete a second auction achieved $3850 which did complete on Thursday 9/11 whether a good or bad store of value, you can decide. I enjoyed wearing it for 30 years, the last two years it lay in a drawer but I'm glad I kept the box etc.

At 2.5% CAGR obviously an attrocious store of value given that undated gilt yields were around 10% at the time; Your £2000 invested in gilts would be worth some £16000 today and buy you four of those Rolexes. Although anecdotal, it's a useful cautionary tale, and one I will bear in mind as I have been buying some art as a "hedge" myself.

GS

I understand your point and agree the enjoyment of wearing the watch is difficult to put a price on but £66 per year represented good value to me so selling it for much more than it cost was a great return personally, I am sure others views would vary wildly.
John