Watches as investments?

djones2

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Hey everybody.

I was just wondering what some of y’all thought about pocket watches as an investment? I know there are so many factors at stake, and I’m definitely not talking about dropping a whole nest egg into pocket watches, haha. I recently purchased an early American pocket watch. I’m not going to lie, I’m in love with it. I’ve wanted this particular kind of watch for the last 10 years. So I was so happy to get it. I’m in my mid 30s, and it felt kinda like Christmas to get it. Anyway, since getting it, I found out there are three different models of this particular watch, and I’ve caught the fever to get all three at some point. That being said, they’re quite pricey, and in my mind, I’m thinking that a high end, rarer pocket watch can be viewed somewhat as an investment, almost like investing in the S&P index, though not as liquid, but definitely more fun. I’m a incorrect thinking this way? What are your thought?
 

Ethan Lipsig

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Pocket watches are terrible investments.
  • Demand is stagnant or declining. So are watch values.
  • Watches, certainly ones that are used, need servicing and repairs. These costs are high and rarely increase the value of the watch by an amount that comes even close to offsetting the costs.
  • It is difficult to find qualified professionals to repair or service antique watches. This will become more of a problem in future years.
  • Parts are generally unavailable, often making repairs impossible or very expensive.
  • Replacement mainsprings are becoming hard to find. Without them, watches will eventually become unusable.
  • There could be a flood of watches on the market in the next two decades when today's collectors or their heirs dispose of their collections. This could depress values.
  • One often incurs sales tax or import duties on purchases, of from 8-30%.
  • One often incurs sales costs of 13-25%.
  • One often incurs storage costs, such as insurance costs or safe deposit box fees.
That's not to say that a knowledgeable dealer can't make a profit on a watch, but I think that most collectors would be happy to break-even on their purchases and sales. "Breaking even" is not a good investment return. On something as risky as pocket watch collecting, doing well would be realizing something like 10% per annum on one's investment.

For almost all of us, collecting pocket watches is not a good investment. It is something we do, however irrationally, for love or satisfaction or some other nonpecuniary reason.
 

djones2

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Oh shucks. That’s what I feared, haha. You’re right though. It’s feels pretty irrational, that’s why I had to ask
 

MrRoundel

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What you, djones2, said about buying higher grade watches, is an age old truism. For the best protection, buy the best you can afford. And if Ethan's correct, which I think he is, you'll be able to afford to be patient until a the great ones comes along. You're still young. As a replacement for a 401K, or owning real estate, I wouldn't advise it. Still, if you factor in your personal enjoyment as part of the total return, I don't think it would be terrible to invest a small percentage in watches. Tally up your yearly Starbucks tab (Or other consumable luxury.) and tell me what will be left of that investment even hours later. On second thought, don't tell me. :}

All that said, if you can get the Robinhood trading crowd into pocket watches as "meme timekeepers", all bets are off, and the sky could be the limit. Are you enough of an "influencer" to get it started? If so, buy as many as you can, then launch your meme campaign.

Welcome to the world of watches. Enjoy your new kinetic artwork with a purpose. Cheers.
 

pmurphy

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I'm in my early sixties so I got into the hobby kind of late. That's just what it is to me, a hobby, and I never thought of my modest collection as an investment. To me they are a window into times past, a piece of history that you can hold in your hand. Something that people in the old days needed to tell time pre-wristwatch and smart phone. Since I was a teenager I've always been fascinated with them for some reason but I never thought of actually owning any until recently.

Another time-telling device on my bucket list is a grandfather clock. Not that it's "worth anything" but another historical artifact I was always interested in.
 
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djones2

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I guess in all honestly, I was just hoping it could hold its value. I’m trying to convince my boss at home that it’s not such a terrible idea to purchase another one if one becomes available, haha. I’ll be really honest, they’re is something very satisfying about finally obtaining something that you’ve said for a long time “If I live long enough and am able, I’ll have one of those.”
 

roughbarked

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I guess in all honestly, I was just hoping it could hold its value. I’m trying to convince my boss at home that it’s not such a terrible idea to purchase another one if one becomes available, haha. I’ll be really honest, they’re is something very satisfying about finally obtaining something that you’ve said for a long time “If I live long enough and am able, I’ll have one of those.”
What's money for, other than spending?
If you think you can spare enough to lock it away in a watch, make it a high end watch.
It is like having a child which you end up spending a lot of money on.
 

djones2

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It feels kinda like a child. I already have family photos with it. I tell my wife I’m needing make my home page on my phone a picture of it.
 
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topspin

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Just to echo Ethan's original point. If you buy a watch and later sell it and you manage to get back more than whatever you put in (allowing for inflation) then you bought and sold very well. You beat the casino.

If you still want to invest in something - invest in the tools, materials and skills necessary to service watches - your own watches, and (possibly) other people's.
 

djones2

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Sorry for sounding so cryptic. It actually might be junk to a lot of people, but I like it. It’s a Dudley Masonic Model 2. So, I’ve been a lodge member since my early 20s. It’s has been like a family tradition sort of thing for my family to join. Kinda like joining the Boy Scouts or something. I’ve always like pocket watches too, but I’ve always had lower grades of pocket watches, save a few railroad watches that really aren’t that valuable. Anyway, in my mid 20s, I had a girlfriend who’s grandfather owned a Dudley Masonic watch. The only time I had heard of a Dudley Masonic at that point was that I remembered seeing a guy at a flea market (who had a booth) trying to sell watches, and he had a sign saying he was interested in buying one. Anyway, the grandfather showed me the watch and told me what it was worth, and I was like “Man, that’s so neat. If I live long enough and am able, I’ll have one of these.”

Then I found out the story behind the watches and found out that the watch was pretty much the guy’s live achievement who made them, but they were pretty much unappreciated during his lifetime. Even went bankrupt and had to go back to work for another watch company in his 80s after his company failed. Attached are a couple pictures. It was sent by mail, so I was a little late for work waiting on it. I just had to take it to work and snap some pics for the wife, haha.

40B6A36F-5E59-447C-920E-913BCEDA77B9.png View attachment 726096 2B96826C-578C-4A84-928E-E8D1B84E157B.png
 

musicguy

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I do not consider my watches an investment in any way, but
almost every watch I have purchased I can sell for more than
I bought it for.

Service costs including crystals, hands, cases, parts etc etc , that's another question.
Watches sell every day for way over value and way under value.




Rob
 

musicguy

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. It actually might be junk to a lot of people, but I like it.
Not junk to anyone here! These have a lot of value
and are in high demand and are great looking!.


Rob
 

djones2

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Mar 22, 2013
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My problem now is that I’m trying to convince my wife that it’s a good idea to purchase the model 1 and model 3. They’re basically the same watch, with some slight cosmetic difference on the movement. I’m trying to shoot the “It’s appreciable property” angle, knowing good and well I don’t want to let go of them if I can.
 

Greg Frauenhoff

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Sorry for sounding so cryptic. It actually might be junk to a lot of people, but I like it. It’s a Dudley Masonic Model 2. So, I’ve been a lodge member since my early 20s. It’s has been like a family tradition sort of thing for my family to join. Kinda like joining the Boy Scouts or something. I’ve always like pocket watches too, but I’ve always had lower grades of pocket watches, save a few railroad watches that really aren’t that valuable. Anyway, in my mid 20s, I had a girlfriend who’s grandfather owned a Dudley Masonic watch. The only time I had heard of a Dudley Masonic at that point was that I remembered seeing a guy at a flea market (who had a booth) trying to sell watches, and he had a sign saying he was interested in buying one. Anyway, the grandfather showed me the watch and told me what it was worth, and I was like “Man, that’s so neat. If I live long enough and am able, I’ll have one of these.”

Then I found out the story behind the watches and found out that the watch was pretty much the guy’s live achievement who made them, but they were pretty much unappreciated during his lifetime. Even went bankrupt and had to go back to work for another watch company in his 80s after his company failed. Attached are a couple pictures. It was sent by mail, so I was a little late for work waiting on it. I just had to take it to work and snap some pics for the wife, haha.

View attachment 726094 View attachment 726096 View attachment 726104
You have a very collectible and interesting watch. By my standards it is high end (price wise), but since most of my watches are valued under $1000 others might disagree.

A check of sales from a well known horological auction company shows that prices for these over the past 15 years have been in a relatively narrow range (most of the variability seems to depend on the case material and model). But then if someone decides to turn one into a "wrist watch" things might change in a much higher direction.

Enjoy your watch and by all means try to convince the boss that it is lonely and needs a friend.

Cheers,

Greg
 

roughbarked

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My problem now is that I’m trying to convince my wife that it’s a good idea to purchase the model 1 and model 3. They’re basically the same watch, with some slight cosmetic difference on the movement. I’m trying to shoot the “It’s appreciable property” angle, knowing good and well I don’t want to let go of them if I can.
It might work better if you drop hints as to what she can buy you for that auspicious anniversary or birthday.
 

Bernhard J.

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Just tell her, that she is extremely lucky to be married with you, because your desire is directed to a model 1 only.

Compared with my wife, who´s husband buys weird things, like I do, see above (show to her the photo in that thread).

We are together since more than 44 years and no end in sight.
 

novicetimekeeper

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I have not bought any of my watches or clocks as investments. The only watch I ever bought new, my wristwatch, I wear every day and is worth twice what I paid for it.
 

djones2

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I have not bought any of my watches or clocks as investments. The only watch I ever bought new, my wristwatch, I wear every day and is worth twice what I paid for it.
I feel like that’s how this watch could be some day maybe. To be honest though, I was so happy to have one, that that’s probably an investment itself. The joy of actually finally obtaining one I mean.
 

Tom McIntyre

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Just tell her, that she is extremely lucky to be married with you, because your desire is directed to a model 1 only.

Compared with my wife, who´s husband buys weird things, like I do, see above (show to her the photo in that thread).

We are together since more than 44 years and no end in sight.
In over 50 years of collecting, I have gone through all the phases of what it is about. I thought for a few years I could learn to deal in watches as a business but eventually learned I could not, lacking most of the necessary skills. Currently I am trying to focus my collecting on a relatively narrow range of pocket watches and am exploring new "crowd manufacturing" based wristwatches that have stories that are interesting to me.

My wife of 64 years still tolerates my behavior and she will even attend an event or two. She likes the community of the NAWCC but cannot get really excited about the stuff. She is very fond of our B. D. Bingham banjo style regulator and tolerates another dozen or so clocks on display (5 of which I wind each Sunday night).
 

Clint Geller

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The advice I give to all new collectors is that the only good reason to own an old mechanical watch is that it gives you more pleasure or satisfaction to own it than would the money you could get by selling it.

I have enjoyed countless hours of researching and writing about the watches I own and their provenances. They are my toys. Yes, they are also valuable and they will remain so, as most of them are gold, if nothing else. But that is not why I seek them out or keep them. Perhaps there are some other people out there who derive as much pleasure from stock investing or owning mutual fund shares as I do from my watches, but I have yet to actually meet such a person.
 
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MrRoundel

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By the way, djones2 , as a first foray into pocket watches, the Dudley is an incredible one to own. I think you'll be very safe in it holding value, perhaps increasing. And their plate design is of such a unique design that's fabulous to look at.

Based on this purchase, I think I'd be inclined to listen to your stock picks as well. ;) That you did a significant amount of due diligence before buying, is obvious. Cheers.
 

Brunod

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The watches I bought as investments are gold pocket watches : I buy them to avoid melting and only at their gold price value. I believe gold price will rise and I'm happy to save the watches even if these are just ordinary pocket watches. By the way, I got the same way a few silver pocket watches too, according their silver price value.
It' so sad...
Otherwise, I never considered watches as investment.
 

Tom McIntyre

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My problem now is that I’m trying to convince my wife that it’s a good idea to purchase the model 1 and model 3. They’re basically the same watch, with some slight cosmetic difference on the movement. I’m trying to shoot the “It’s appreciable property” angle, knowing good and well I don’t want to let go of them if I can.
By the way, although I do not own any Dudley's, I believe the guts of the No 1 are from Waltham while the 2 and 3 are from Hamilton.
 

djones2

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By the way, although I do not own any Dudley's, I believe the guts of the No 1 are from Waltham while the 2 and 3 are from Hamilton.
So does that mean I could still possibly find a mainspring if this one was to break? I imagine if it was a movement of a unique creation, it would be very difficult to find. Just a thought I guess.
 

djones2

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Yes. Mainsprings are rarely made for only the one watch or clock.
That’s good news. I’m sure I’ll want to wind it every once in a while before I lay it back in my safe. Heck, I don’t even really need to get it out. I have probably a dozen pictures of it.
 

Lee Passarella

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Just to echo Ethan's original point. If you buy a watch and later sell it and you manage to get back more than whatever you put in (allowing for inflation) then you bought and sold very well. You beat the casino.
And unless you beat the 15-1 or 25-1 odds (or whatever it is) at the casino, you end up with zilch. At least when you buy a watch, you have something in hand, even if it depreciates rather than appreciates in value. So just enjoy, and let your heirs and assigns deal with the residue.
 

Dr. Jon

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Watches are investments. Investments are forms of value not cash and as other investments they can rise and fall in value.

One can buy watches with the idea of selling for more money that you bought them for and if you hold them long enough , like a home or a securities portfolio they will depreciate less than cash. There are people who make a very good living at this. It is not easy.

Buying watches is like planting trees, the best time to do it is 50 years ago.

For me it a small part of what I spend and I enjoy the research. I leave the stock buying and security portfolio to pros who really enjoy that and over the years as a percentage I have been fairly close in the performance of my portfolio. yes I have sold do I do reality check.

I buy mostly at auction with awareness that I have just paid more than anyone else was willing to at that time. If you think you are going to profit immediately from this you need to sure you know something the other bidders do not. I do not "win" often. I am fine with walking away although most of the times I felt I paid too much I have been wrong.

I obsevere what is going on with people who buy and sell. 30 years ago I saw a lot I did not like in high value American pocket watches and decided to look at others, English and European. The kind of watch I like is almost always in a gold case so my "securities" are gold cased. Auction houses occasionally miss important features of these watches. Their experts have to cover a very broad range and I specialize. Sometimes I see stuff they miss.

Also gold watches sometimes go for less than their gold content. I recently got about 20% more in gold than than I paid for the watch. I bought it for other reasons and the house cheated on the bids. I was not until I had it and took a closer look that I realized I had done so well. The general rule is to get to know what makes an item high grade and buy those. What made in go for this, watch was that it was made by a maker I like a lot but is not widely known and that auction house description was wrong in a the detail I wanted.

The watch had a document with it in French they did not bother to read or understand. They described it as repair record. It was an observatory bulletin stating the watch had passed tests at an observatory, second class. (Watches with first class bulletins are rare but they are out there) It is the only such document I know of and it is with the watch. The gold was nice bonus.

When I started, I was intrigued that I could buy an American railroad watch for fewer dollars than it cost when new 50 years before. They have since gone way up and most have come down. I am still ahead on most of them.

If you are going to make or hold money, stay with quality and avoid fads. Be prepared to change directions and be patient. Be your own person and develop your own judgement.

By far the best part of my investment has been doing the research enjoying my watches and the camaraderie of fellow collectors.
 

CentreKeystone

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As a related note...There are several Youtube videos on the recent collapse of luxury wristwatch values.
 

Dr. Jon

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I almost always buy items I believe to be undervalued. These are not discounted but I buy the watch not the name and when I see a very good by someone I had not heard of or who I believe to be under appreciated, I get very interested.

For a long time, most collectors hated watches with inscriptions. I love them especially when I can learn about who they were. It adds a lot.

Some things are untouchable to me. Abuse is one there are no bargains on abused watches, stuff made up of old junk or counterfeit.


There are a lot things most "collectors" don't want that I think have merit. I sometimes find them very attractive.
 

Clint Geller

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Buying watches to resell in the short term, that is, flipping, is very different than buying a watch as a long-term investment. Even if one manages to buy a watch for well below its current market value, which I have done quite often over the years, viewed purely as an "investment," the smartest thing to do with such a watch usually is to resell it, not hold it for a long time. Often, the "right time" to sell a watch is when the right buyer comes along for it. Of course, collectors, almost by definition, are not cool, dispassionate investors simply out to turn a profit. If one is a savvy, dedicated collector who specializes and does his homework, one will almost undoubtedly make out on some of one's acquisitions. However, it is the rare collector who manages to sell a significant collection for a price that approaches what the same investment in stocks or real estate might more typically have realized over the same period. The pocket watch market, especially the American pocket watch market, is very thin and easily saturated, which means that a few watches might quickly realize their full market value in a sale, but recent history is replete with examples of large collections that were sold in a hurry, where the selling collector lost a major piece of his anatomy. While I strongly advocate specialization, one of its down sides is that it tends to make the problem of market saturation even worse. If you are overinvested in a particular kind of watch, even a very desirable, collectable kind of watch, you may find that it takes more time than you have left to dispose of them all on the best terms.
 
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