Watches are objects whose cultural and monetary value is immune to fashion. Indeed, their value continues to increase as their hands mark the passing of time. Along with works of art, jewellery and precious stones, collectors’ watches act as safe haven assets in volatile financial markets.
Vintage collectors’ watches, like other tangible assets such as rare wines, works of art, vintage cars and diamonds, provide safe havens and are a valid form of alternative investment that has little correlation with other asset classes. The low correlation, high portfolio diversification and complete anelasticity to economic shocks all contribute to an immediate reduction in the volatility of the portfolio’s assets.
Unlike the financial markets, prices are determined solely by demand for luxury goods, for which the already limited supply will continue to shrink. The collectors’ watch market is a relatively new market (established around 25 years ago). Vintage watches are still regarded as rare exclusive and even unique items.