A watchmaker displays the workings of a Patek Philippe ladies Grand Complications luxury wristwatch at the Patek Philippe SA headquarters in Geneva. Source: Getty.

The Best Luxury Watches to Invest in 2021

In the event of an economic downturn – like the coronavirus – fine watches are proving to represent a safe-haven asset, like gems or diamonds, for investors looking to diversify their portfolios. 

Watch collecting is similar to art collecting in that dealers tend to reserve the most coveted pieces for insiders and heavyweight collectors – rarely making them available to the general public. 

Domonic Khoo, turned his love for watches into an investment fund called The Watch Fund. Based out of Singapore, The Watch Fund has over 9,000 watch collectors worldwide – 30 of which have around $25 million invested in 100 watches.

“We had a Patek Philippe that the customer bought for £300,000 and sold 18 months later sold for £425,000 without ever wearing it.”

– Domonic Khoo told The New York Times.

So, are watches the new quintessential blue chip? And if so, which luxury brands are making the most of the secondary watch market?

report published by UK Private Bank Coutts found fine watches have increased in value by over 125 per cent since 2005. 

Source: Coutts*

The growth prospects for the secondary luxury market are likely to improve with a growing demand for vintage watches and the desire among younger generations to own top vintage and limited edition pieces.

“Driving the value of pre-owned watches is the overall condition of the watch and the completeness of the set: a full set with original box and certification papers can warrant a 20-30 per cent premium.”

Deloitte, Swiss Watch Industry Study 2020.

Sotheby’s – one of the worlds largest renowned auction houses for watches, jewels and fine art – brought in $10.4 million at its Important Watches Auction in December last year – posting a 27 per cent increase compared to 2019. 

Select luxury brands like Rolex, Patek Philippe and Audemars Piguet continue to dominate the primary and secondary luxury watch market with smaller independent brands like Richard Mille and MB&F growing in popularity among collectors.

So, how do you decide what style to choose to give you the best return if you decide to sell? We did some digging, and this is what you need to know.

The Rolex Daytona

Unsurprisingly, Rolex is still on top of the list of the Swiss Watch Industry, with a market share of almost 25 per cent. This year for the first time (at least according to Morgan Stanley), the Rolex Group (Rolex + Tudor), has become more successful than the entire Swatch Group conglomerate with its 27 per cent share of the market.

“As rarity is one of the biggest drivers of value, limited edition and discontinued watches are the best place to invest.”

Deloitte, Swiss Watch Industry Study 2020.

With Rolex “King” and charging the Swiss watch industry. And, if you’re looking for strong returns, the Rolex Daytona is a good bet to make.

Designed in 1963, and named after the Daytona Speedway Track in Florida – this was the first watch ever made purely for motor racing. An automatic wristwatch fitted with a rotating tachymetric bezel can measure speeds up to 400km/h.

The Daytona set off as the most iconic watch globally, after it was seen on the wrist of once, the most bankable movie star in the world – Paul Newman. Paul’s personal Daytona was a gift from his wife Joanne Woodward, who engraved the casting on the back – “Drive Carefully Me.”

Many people are saying this is the greatest watch on the planet. This watch transcends watch collecting, it transcends the watch community.

Geoff Hess, a vintage Rolex collector and CEO of Analog Shift told Fobes.

This exact watch – which Newman wore for 15 years – sold at Philips Auction House in New York in 2017, for over A$17.8 million, making it the world’s most expensive Rolex to have ever sold.

Since its launch in the ’60s, Rolex has reimagined the design with different metals: Platinum, Yellow and White gold – and various bezel and designs features.

You can tell a Rolex Daytona from a mile away. With its pronounced pushers and crown, tachymeter bezel, smart colour scheme, and the three perfectly proportioned and legible sub-dials.

The Rolex Daytona is one of the most sought after watches which has seen a 47 per cent jump in value. At retail price, a Rolex Daytona can cost anywhere from A$34,000 to $60,000 and above.

Audemars Piguet Royal Oak

With only 250 watches ever made, the Audemars Piguet Royal Oak was the first luxury steel sports watch designed by 20th-century genius watch designer Gérald Genta.

A sports watch, designed for any occasion with the most beautiful of finishes. Taking inspiration from traditional diving helmets, Genta expressed the bolts as the bezel’s hexagonal screws –exposing this technical element on a watch was considered bold and innovative at the time (1972).

Tim Stracke, CEO from the luxury marketplace, Chrome 24, says steel watches from renowned watchmakers are the ones that perform well in the market.

Steel sports models from iconic brands are usually the ones that out-perform the global stock indexes – the Royal Oak, a clear favourite on his list.

Tim Stracke.

Recognised for its blue dial with a “Petite Tapisserie” pattern and satin-brushed finish, the watch blends two metals — titanium and platinum — which give it depth and counterbalance each other in weight. The 3.05mm-thin, in-house calibre with 40 hours of power reserve makes this watch slim enough to fit under your shirt sleeve.

The Royal Oak is one of the most iconic limited edition pieces today. With an estimated price value of A$64,000 for a pre-owned Royal Oak – this vintage masterpiece has increased in value by over 1000 per cent since its debut.

While the vintage design is hard to get your hands on in the retail market, Audemars Piguet is set to launch a Limited Edition Collection this year. The Limited Edition 200-piece Collection will be made available for watch collectors wanting to invest in a new watch with a vintage look and feel.

Patek Philippe Nautilus

Seven out of the ten most expensive watches ever sold were Patek Philippe watches. The Stern family has been at the helm of the empire for over 80 years and is now in its fourth generation.

Originally unveiled in the 1970s, the Nautilus has become a veritable icon in the horological world, sparking a long waiting list at retailers. While news broke earlier this year that Patek would discontinue its most desirable model, arguably the most coveted watch in the world, the brand is already pushing its replacement out to the centre stage. As part of the kickoff of Watches and Wonders, the industry’s biggest trade show, Patek announced a quartet of new Nautilus models, including the successor to the navy blue 5711.

In April 2014, a Patek Philippe Nautilus ref. 5711 in platinum, sold at a Sotheby’s Online Watch Auction and set a world auction record when it sold for US$484,000 (approximately A$624,000). The reason? Exclusivity. Patek Philippe manufactures only 50,000 watches a year, and timeless models like the original blue dial are hard to come by.

The star of the show is the 5711/1A-014, identical in nearly every way to the watch that came before it, but for one key difference: The Nautilus is switching out its traditional blue dial for one in olive green. If you’re new to the world of watch collecting, that might not sound like much. But in an industry that obsesses over millimetres, this change is enough to set the world on fire. This is the first time the shade has shown up on any Nautilus. The waitlist for the item—would-be buyers waited up to a decade to buy the discontinued 5711—starts now.

Following the announcement that 2021 will be the last production year of the stainless steel model Ref. 5711/1A, this cult model is unveiled with an olive green dial – a hue that never existed before in the Nautilus collection. This new shade replaces the Ref. 5711/1A-010 with a blue-black graduated dial. With the watchmaker announcing the last production of this model – the olive green will be one watch many collectors add to their list.

Rolex GMT Master II

When Rolex reintroduced the stainless steel Pepsi-bezel GMT Master II in 2018, everyone who owned a vintage Pepsi GMT rejoiced, and everyone who wanted to own one but didn’t panicked. That’s because Rolex’s new release kicked off a Pepsi bezel fever that caused the prices of all older Pepsi-bezel Rolex references to blow through the roof.

While certain Pepsi GMT Master or Master II references could be found for around A$7,000 just a few years ago, it’s now practically impossible to find one under A$10,000, with most references starting around A$12,000 (even though the new ones retail for A$9,700, they sell secondhand for twice that).

The exception is the GMT Master II ref. 16710. Readily available for about two grand less than other Pepsi references, it’s only a matter of time before this model — the second generation of the GMT Master II — catches up to the rest of its soda-loving family.

TAG Heuer Monaco

The first version of the Heuer Monaco was unveiled at the Basel fair as the world’s first waterproof automatic chronograph with a square case. With a retail price of US $200, it was available in two variations: reference 1133B and reference 1133G where the B stands for Blue and G for Grey while the first two digits refer to the mounted calibre.

But there are no legends without heroes and for the legendary Monaco chronograph, the hero is, without doubt, Steve McQueen which gave exceptional exposure to the watch during the filming of the “Le Mans” movie, produced in 1970 and released in 1971.

And in July 2012, one of the two Monaco wristwatches worn by Steve McQueen during the filming of Le Mans was sold at a Hollywood memorabilia auction at the price of US $799,500 (including the buyer’s premium) – approximately A$1.3 million.

And, as a nod to the watchmakers and this moment in history, in 2019 – Tag Heuer completed the celebration of the 50th anniversary of the watch. TAG Heuer presented the Monaco Heuer 02, the first Monaco timepiece to feature the brand’s Calibre Heuer 02 Manufacture movement. As the final edition of the Monaco Calibre 12, only 1,000 of these models exist and the stainless-steel case back of each watch is engraved with its limited-edition number. Not only a timepiece, but an investment – fit to stand the test of time.

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