A timely investment: Can luxury watches outperform luxury stocks?
With the prices of timepieces stabilising, experts believe that a diversified approach is the best way to invest in the luxury watch market
The wealthy have long had a love for purchasing the finer things in life. But, for horophiles, investing in watches hasn’t exactly proved to be lucrative over the past couple of years. According to price and sales trend tracker Watch Charts, the pre-owned value of Jaeger-LeCoultre watches has declined 12.1 per cent over the past 12 months at the time of writing. The value of the Panerai market has declined 9.1 per cent, while the Audemars Piguet market has pulled back 3.3 per cent. Patek Philippe and Rolex have been outliers, rising by 2.7 per cent and 1.2 per cent respectively.
Second-hand watch prices peaked in March 2022. The fortunes of the wealthy had soared during the pandemic amid a global stock market rally and booming property prices. They had more cash to splash on luxury goods than ever before — partly because they weren’t spending as much on holidays and experiences. As production of new watches slowed due to manufactures shutting down, buyers turned to the secondary market in their droves.
Prices began to cool as economic uncertainty and rising interest rates curbed consumer spending. Over the past six months, however, prices have shown signs of stabilisation. The current price levels could present wealthy investors with an opportunity to acquire valuable timepieces at a more affordable price – but there are things to consider before making a purchase.
Think of watches as a store of value
For starters, as with any investment, buyers need to be aware that they won’t necessarily see a return on their investment. Sergei Grechkin, chief strategy and risk officer at alternative investment fund manager Cayros Capital, believes that watches should be seen as “collectors’ items first and investments second”. Only certain brands — namely Patek Philippe and Rolex — have a strong track record of maintaining or increasing their value over time, he adds.
Paul Ferrara, senior wealth counsellor at independent private wealth manager Avenue, says “interest in watches as a long-term store of value is high, but watches are very sensitive to demand cycles”. There are a combination of factors that will determine whether a watch’s value might increase, he adds, such as how rare it is, the condition it’s in, and whether it has brand momentum behind it. The fact that it can take investors years to see their purchase rise in value, if at all, means “the opportunity cost can be high”.
A wait-and-see investment strategy may be a suitable approach for investors that are happy to have capital tied up for an unspecified period of time. However, watches are effectively “dead assets, because they don’t do anything,” stresses Lewis Crompton, founder of trading education platform STARTrading. “They are not making wealth; they are just storing it and protecting against inflation. A property, on the other hand, if purchased correctly, is a living asset as it grows in value and can generate income [through being rented out] here and now.”
There’s also the issue of illiquidity. The high price tags of luxury watches mean that there’s typically only a small pool of individuals who can afford them. The rarer the watch, the fewer buyers there are.
Gain exposure through stocks
Investors looking for a more liquid play on the luxury watch market could consider buying shares in companies that offer exposure to mechanical timepieces. These include London-listed retailer Watches of Switzerland, the biggest Rolex seller in the UK, and Switzerland-listed watchmaker Richemont, which owns the Jaeger-LeCoultre and Panerai brands, among others.
The Watches of Switzerland share price was trading near to a five-year low over the summer when it announced that it expected profit margins could be squeezed by US tariffs. The stock was given a mini boost in September 2025 after a market update reassured investors that trading in the US had been “particularly good” and it didn’t expect any “material impact” from the tariffs in the six months to the end of October. Nevertheless, the Watches of Switzerland share price remains down around 75 per cent from its pandemic high.
Ferrara says “a depressed share price may open the door to gain in the long run, in the event that margins improve”. Investors buying shares in any publicly-listed company, like Watches of Switzerland, would be advised to follow earnings reports — they’re released every three or six months — and keep an eye out for news updates that have the potential to move the stock.
Grechkin argues that “the present price is a good place for long-term investors to step in" because the luxury market has “a pattern of bouncing back from quiet times”. For example, Swiss export data shows that luxury watch sales bounced back in 2017 following two years of declines.
Deciding whether to buy into a stock at its current price depends on an individual’s investment goals, time horizon and risk tolerance. Buying shares in a company you believe will perform well over the next five to 10 years usually pays off, but there are no guarantees.
Investors with a low risk threshold could consider investing in exchange-traded funds (ETFs), which track a range of companies and indices across different themes, industries and countries. There are two focused exclusively on the luxury market: the Amundi S&P Global Luxury UCITS ETF and the KraneShares Global Luxury Index ETF. Both currently offer exposure to Richemont, though not Watches of Switzerland. These types of funds “may be less sexy, but could create a more peaceful growth over time,” says Crompton.
The importance of a diversified portfolio
The experts all agree that watches and luxury stocks should form part of a diversified portfolio of investments. Putting money into luxury stocks offers “direct exposure to global economic cycles and consumer trends,” says Grechkin, and investors could benefit from a luxury market recovery. On the other hand, investing in watches can help to “keep risk in check” and stabilise a portfolio “when the market is volatile”.
A portfolio of stocks should ideally be reviewed and updated from time to time. Watches, on the other hand, says Crompton, “are easier to maintain and require little to no work”. The bottom line, he adds, is that “having diversification is a form of protection”.
