Our Research
Half of the luxury watch owners in our research did not know that certain references have, over rolling five- and ten-year periods, outperformed the S&P 500. Here is what sits underneath that headline — and the much larger universe of references for which it does not apply.
The references represented in the top quartile of luxury watch returns are not a random sample. They are not the average watch. They are not even the average watch from a top-tier brand. They are a relatively small population of references — characterized by specific attributes — that have, for a combination of reasons, behaved as the headlines suggest. The vast majority of luxury watches sold each year are not in this group. The first job of disciplined watch acquisition is recognizing the difference.
Among the brands investigated in a study of more than 90 watches across 25 brands, only specific watches from several watch brands appreciate on average. For the most part, they are:
Omega, Jaeger-LeCoultre, A. Lange & Söhne and F.P. Journe to a lesser extent.
Investment-grade tier, S&P 500 total return, and the broad luxury watch market, indexed Jan 2015 = 100
The most-cited returns in the watch category come from a specific window — roughly 2018 through 2022 — that combined unusual demand pressure, supply constraints, and macroeconomic conditions in a way that produced exceptional appreciation in a narrow set of references. Returns since that window have been more measured. Some have given back. The references that hold up across more conservative windows are a smaller subset still.
Understanding what actually happened during that window matters — both because it explains the headlines, and because it explains why those headlines are an unreliable guide to acquisition today.
The demand pressure was real, and it came from several directions at once. The pandemic redirected significant discretionary spending. Travel stopped. Restaurants closed. Experiences disappeared. Capital that would have distributed across a normal consumer year concentrated instead into objects — and luxury watches, already an established store of value in the minds of affluent buyers, absorbed a meaningful share of it. At the same time, government stimulus programs and asset price inflation put capital into the hands of buyers who had not previously participated in the category.
Cryptocurrency gains, realized at scale for the first time by a generation of younger investors, sought tangible stores of value. Social media — Instagram, then TikTok — had spent the preceding years building watch culture into something visible to an audience far beyond traditional collectors. The result was a demand cohort that was broader, younger, and more speculative than anything the category had previously seen. A meaningful portion of the buying was not collector-driven — it was return-driven.
The supply constraints were structural, and they were not new — but they mattered more during this period than they ever had. The Swiss watch industry, and Rolex in particular, has practiced production discipline as a strategic tool for decades. Output is managed. Supply to authorized dealers is rationed. Allocation of the most desirable references requires purchase history, relationship, and patience that most buyers cannot or will not supply. This is not accidental — it is brand policy, and it has been remarkably consistent.
What changed during this period was the ratio between that constrained supply and the newly expanded demand. Wait lists for certain references extended to years. The gray market — always present, always pricing at a premium for scarce references — expanded rapidly as buyers unwilling to wait paid above retail for immediate access. That gray market premium became self-reinforcing: rising prices attracted more speculative buyers, which drove prices higher still.
The macroeconomic conditions were the accelerant. Near-zero interest rates through 2020 and 2021 changed the opportunity cost calculation for holding non-yielding assets. A watch that does not pay a dividend or accrue interest looks different as an investment when a ten-year Treasury yields under one percent than it does when it yields four or five.
The reversal, when it came, followed the same logic in reverse. The Federal Reserve's aggressive rate-hiking cycle beginning in 2022 raised the opportunity cost of every non-yielding asset simultaneously. Cryptocurrency markets collapsed, eliminating a significant cohort of wealth that had been flowing into tangible luxury. Equity markets corrected sharply in the same year. Prices corrected — sharply for the references that had attracted the most speculative interest, more modestly for references with deep, durable collector bases.
After the correction
The references that held value were the ones that had always held value — not because of the boom, but despite the noise around it. The references that gave back the most were, in retrospect, the ones that had risen furthest on speculative momentum rather than collector fundamentals.
A buyer evaluating a reference today should be skeptical of any analysis that draws its returns exclusively from the 2018–2022 window. The honest data extends earlier and later, and it tells a more nuanced story. The window was real. It is also over.
Configuration versus resale recovery
Every chapter of this guide that talks about appreciation has a counterweight. This is it.
The luxury watch market does not consist exclusively of references that hold or appreciate. The reality, for the average buyer of the average luxury watch, is more sobering: many — likely most — luxury watches lose value the moment they leave the boutique, and continue to depreciate at meaningful rates for years afterward.
This is not a moral failure of the market. It is the natural behavior of any consumer durable. New cars depreciate. New furniture depreciates. New watches, in the great majority of cases, do too. The fact that some watches buck the pattern is what makes the headlines. The pattern itself is the rule.
Knowing which references — and which configurations — fall into the pattern, rather than the exceptions, is what protects buyers from the kind of regret our research found in roughly twenty percent of luxury watch owners.
Without naming specific references, here are the categories of luxury watch we most often counsel clients away from when their goal includes any element of value retention:
Heavily diamond-set configurations
Particularly in references that are not the brand's signature jewelry models. Adding diamonds or precious stones — even by the brand itself — tends to narrow the buyer pool. The intuition that precious materials add value is, in this category, almost universally wrong at resale.
Unusual sizes for the reference family
The size that was the brand's reference standard at the height of the reference's market behaves differently than larger or smaller variants introduced later. Buyers gravitate to the canonical size; the variants discount.
Aftermarket modifications
A diamond bezel added by a third party. A custom dial. A non-original bracelet. The market for modified watches is a fraction of the market for original ones, and the prices reflect it.
Gray market acquisitions with incomplete documentation
The watches themselves may be authentic. The savings at the moment of purchase are often real. But the absence of brand-original sales documentation, full warranty records, and clean provenance reduces the eventual buyer pool — and, often, the eventual price.
Heavily polished cases
Polishing removes material. In a market that increasingly values originality, a watch that has been polished more than once can lose a meaningful percentage of its value relative to an unpolished or lightly polished example of the same reference. This effect compounds with age.
Observed transaction ranges, expressed as a percentage of original retail price recovered at secondary sale.
| Configuration | Recovered at resale |
|---|---|
| All-steel sport (premium) | 85–155% |
| All-steel dress & date | 70–105% |
| Factory gem-set | 58–77% |
| Atypical size variant | 50–65% |
| Aftermarket modified | 20–75% |
All-steel references recover the widest and highest bands; aftermarket modification is the single widest spread, and the lowest floor. Individual results vary by reference, condition and timing.
Next step
The Four Vs is how we judge a reference against both halves of the question. If you're weighing a listing now, a written verdict within two business days is often the cheapest part of the transaction.