Smart ways to buy and pitfalls of investing in high-end watches

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Born in Armenia and raised in Southern California, Edvin Ovasapyan is an accomplished investor, entrepreneur and financial strategist. His studies began in accounting and pivoted to the pharmaceutical industry, where he remained for over two decades. Edvin’s passion for complicated cars and watches developed in his mid-twenties and blossomed into a sophisticated collector.

When he’s not traveling the globe for his next acquisition of a business, a rare vehicle or a watch, Edvin is a die-hard Real Madrid fan, avid cyclist and, above all, a very proud father of her two adorable children.

For many, investing in timepieces may seem like the perfect win-win situation. In theory, it enables the purchase of a highly sought-after luxury item, the pleasure of owning and wearing such expressions of craftsmanship, and the eventual profits when reselling the item on the secondary market. Additionally, investing in a timepiece can be an investment in self-esteem, something to pass down to your children or other family members, or an addition to a well-maintained and organized collection.

And we’ve seen how the timepiece market has exploded in recent years, fueled by limited production due to the pandemic, style shifts and changes in luxury spending habits. Auction houses keep breaking records, especially with vintage pieces, some to six figures. However, as profit on resale is not always guaranteed, investors should be wise to ensure that they do not succumb to the many pitfalls of investing in high-end watches. Here’s what you can do to avoid some of the biggest risks and mitigate exposure to market fluctuations.

Invest in yourself

It is perhaps easy to forget, in a world where luxury and highly sought-after products such as sneakers are so commonplace, that such purchases may only be for pleasure, too. If you’re intimidated by the prospect of reselling, or if you’re on the hunt for a new high-end watch just out of passion, there are things you can do to maximize potential returns if you ever want to part with it.

The first is to always be selective. Some might tell you to start with a certain brand or niche market segment, or head towards names like Rolex or Patek Philippe, but if you’re buying for fun, you have to choose what you like. This serves the dual purpose of keeping you happy with your purchase, while passively increasing the value of less popular brands. The power of this should not be underestimated and an unsuspecting outsider may surprise you for years to come.

The second crucial tip is to buy early. Provided you have the capital, don’t wait to see if others buy it or if it gains popularity: rip it off at market value to increase your chances of a profit on resale.

Purchase for the purpose of selling or trading

Although there is absolute legitimacy in buying watches to simply enjoy and wear them, many have decided – especially given the recent boom in profitability – to buy a horological instrument and use it as a commodity. to trade or sell on the auction market.

If you decide to venture into this area, you’ll need to keep a close eye on the market to see what’s popular and trending, and grab those models as close to retail value as possible. Interestingly, the unlikely boom in the vintage and pre-owned watch market at the onset of the COVID-19 pandemic was largely attributed to people having more free time to research the market and find out what might be popular. With this increasing competition against other in-house watch experts, forums such as Rolex Forums, Chrono24, eBay and TimeZone will be your best friend. See what coins are selling for and where, asking prices and actual sale value. Staying ahead and avoiding inflated prices will allow you to get the most out of your purchase.

If this is your first time entering this market, other things to look out for include pre-owned and limited edition timepieces and watches with small production numbers or an interesting origin story or a previous owner, because rarity and exclusivity most often correspond. assess. You should also seek to prioritize quality over quantity when building a collection, take great care of it, and be patient when looking for new pieces. Finally, oddities like manufacturing errors don’t always have to be a red flag. Consider the Rolex Daytona 16520, whose “inverted 6” on a small lot made it very desirable, for example!

Best secondary market

When it comes to reselling your watch, the best platform to maximize your earnings will be a respected auction market, rather than your traditional secondary watch dealer. Indeed, being in direct competition with other end users will increase prices and increase your earnings. You’ll also be able to gauge prices and see real-time demand on your watch, rather than relying on what your dealer tells you.

When using these marketplaces, be sure to bide your time and not be put off by cheap offers, and always consider the fees so that you are not disappointed with your bottom line. https://www.secretentourage.com/lifestyle/watches/money-selling-watches/

Avoid hidden risks

As with any investment, there is capital at risk. But there are some perils specific to the timepiece market that you should also be aware of. As mentioned, the used market is booming and is a great starting point for those on a budget. However, the risk of counterfeiting, theft or watches in poor condition is high.

There is also a phenomenon of ‘Frankenwatches’, which are a low value combination of a number of different watches, re-enacted as Frankenstein’s monster. Needless to say, there is a stark difference between desirable manufacturing quirks and damaged or counterfeit products! Protect yourself by obtaining the relevant documents, when you can, and doing your due diligence before you buy.

Above all, treat yourself by investing in timepieces. If you have the capital, these luxury and high-end watches are something to admire and enjoy. And, of course, if you can do it while making good profits, then you’re a winner.

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