Would you pay $17.8m for a wristwatch? That is how much an anonymous buyer shelled out for a Rolex Daytona that once belonged to Paul Newman, the late Hollywood star, in 2017. It was the most expensive wristwatch ever sold at auction, and a testament to the allure and value of fine timepieces.
But watch investing is not for the faint-hearted. It requires knowledge, patience, and vigilance. The market is rife with fakes, frauds, scams, and thefts. According to the Federation of the Swiss Watch Industry, counterfeit watches account for around 9% of global customs seizures, and cause an estimated loss of CHF 1.6bn ($1.8bn) to the Swiss watch industry every year. Meanwhile, the Art Loss Register, a database of stolen art and collectibles, lists over 60,000 missing watches, some worth millions of dollars.
How can you avoid falling victim to these common pitfalls and risks of watch investing? Here are some practical tips and advice to help you navigate the complex and fascinating world of horology.
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Tip 1: Do your research before buying or selling a watch
The first and most important rule of watch investing is to do your homework. You need to know as much as possible about the watch you are interested in, such as its brand, model, condition, history, and market value. This will help you avoid overpaying, under-selling, or buying a lemon.
There are many sources and tools you can use to research watches, such as online databases, forums, blogs, magazines, and books. For example, you can check the serial number of a watch on websites like Watchfinder or Chrono24 to verify its authenticity and provenance. You can also browse online catalogues of auction houses like Sotheby’s or Christie’s to see the prices and descriptions of similar watches that have been sold in the past.
But don’t rely on online information alone. As Aurel Bacs, a renowned watch auctioneer, advises, “The best way to learn is to handle as many watches as possible. Go to auctions, go to dealers, go to fairs, go to museums, go to collectors’ gatherings and see, touch, feel, listen and smell watches.”
Tip 2: Buy and sell from reputable and trusted dealers or platforms
The second rule of watch investing is to buy and sell from reputable and trusted dealers or platforms. This will reduce the chances of encountering fakes, frauds, scams, or thefts. You should always look for dealers or platforms that have a good reputation, a long history, a large customer base, and a transparent and secure transaction process.
There are many options for buying and selling watches, such as authorized dealers, auction houses, or online marketplaces. Each has its own advantages and disadvantages, depending on your preferences, budget, and goals. For example, authorized dealers offer the most assurance of authenticity and quality, but they also charge the highest prices and have the lowest variety. Auction houses offer the most excitement and potential for bargains, but they also involve the most risk and uncertainty. Online marketplaces offer the most convenience and selection, but they also require the most caution and due diligence.
As Paul Boutros, the head of watches for Americas at Phillips, a leading auction house, explains, “There is no one-size-fits-all answer to where to buy or sell a watch. It depends on what you are looking for, what you are comfortable with, and what you are willing to pay or accept. The key is to do your research, compare your options, and trust your instincts.”
Tip 3: Inspect the watch carefully and ask for authentication and documentation
The third rule of watch investing is to inspect the watch carefully and ask for authentication and documentation. This will help you confirm the identity, condition, and value of the watch, and avoid buying or selling a fake, damaged, or stolen watch.
You should always inspect the watch in person, or ask for high-resolution photos and videos, before buying or selling it. You should look for details such as serial numbers, hallmarks, logos, movements, or signs of wear and tear, that can indicate the authenticity, quality, and history of the watch. You should also ask for authentication and documentation, such as certificates, warranties, receipts, or service records, that can prove the ownership, origin, and maintenance of the watch.
But be aware that fakes and forgeries are becoming more sophisticated and harder to detect. As Nick Foulkes, a watch journalist and author, warns, “The counterfeit industry is a constantly evolving arms race. The fakers are always trying to outsmart the experts, and the experts are always trying to outsmart the fakers. The only way to be sure is to buy from a reputable source, and to get a second or third opinion from a trusted expert.”
Tip 4: Protect your watch and yourself from theft and damage
The fourth rule of watch investing is to protect your watch and yourself from theft and damage. This will help you preserve the value and enjoyment of your watch, and avoid losing it to criminals or accidents.
You should always store your watch in a safe, secure, and appropriate location, such as a safe, a lockbox, or a watch winder. You should also avoid wearing or displaying your watch in risky situations, such as crowded places, unfamiliar areas, or extreme weather conditions. You should also report any suspicious activity or incident to the authorities, and keep a record of your watch’s details and photos.
Moreover, you should consider getting an insurance policy for your watch, especially if it is very valuable or sentimental. This will cover you in case of theft, loss, or damage, and give you peace of mind. You should look for an insurance policy that is tailored to your specific needs and preferences, such as the type, value, and usage of your watch, and the level of coverage, premium, and deductible you are comfortable with.
As John Reardon, the founder of Collectability, a watch education and e-commerce platform, advises, “Protecting your watch is not only a matter of security, but also a matter of respect. You are not only protecting a financial asset, but also a piece of art, a piece of history, and a piece of yourself. You should treat your watch as you would treat any other valuable and meaningful possession, with care, caution, and pride.”
Conclusion
Watch investing can be a rewarding and enjoyable pursuit, but it also comes with many challenges and risks. By following these tips and advice, you can avoid common pitfalls and risks of watch investing, and make the most of your time and money.
Do you have any other tips or advice on how to avoid common pitfalls and risks of watch investing? Do you have any questions or comments on this topic? Please share your thoughts and experiences with us in the comment section below.
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