The Watch
Investment Series...
Gold Rolex GMT-Master
Investing in collection watches
The Rolex 1675/8 - the gold GMT-Master
If some say gold watches are not a good investment, you can for sure tell they live in the past. The statistics here just show than from 2005 to 2010, there was a lack of interest for such watches but within 3 years, prices grew consequently and it is not over. Why is that?
It could be a “fashion” effect. 2000 to 2015 was the “golden age” of steel watches and this is the exact period where steel Daytona watches started to raise in value to an extent never seen before. But fashion is fashion and it never last… The truth is when you want to invest on a watch which will enable you to make a good profit, choose the rare one. And gold Rolex GMT-Master in good condition are rather rare. They are harder to find than any steel watch. The main reason is when you put your watch at Rolex for a service, they usually polish the watch in order to give it a “new watch” appearance. And polishing involves loosing material. Steel is hard material so you can polish two or three times before it starts to look worn, rounded and thinner. But gold is a very different matter. Gold is a moldable material. And polishing also involved heating the metal (friction). Thus, two or three polishing cycles can make your watch thinner, rounded and worn and you cannot go back…
However, you can still find good condition Rolex GMT-Master in pristine condition and make a good investment as a collector will always be looking for the good condition gold watch, and not for an old worn polished one.
How can I evaluate the condition of a gold watch?
The lugs are the main parts which will help you for such evaluation. below is a “New Old Stock” picture versus a three/four times serviced/polished watch. You can notice that the thickness is different, if you know about the original thickness of course, but you can easily nee than the edges are round instead of being sharp and you can also see that the bevel has almost disappeared on the polished watch. This is what you must look at.
The second thing you should check is the condition of the bracelet. Is the bracelet “slack” or loose. Gold being a malleable metal, bracelet links are more fragile and such bracelet becomes loose with time.
Example of a Rolex 1675 Jubilee Bracelet. One is used the other is good condition (credit right picture M&B Watches).
Are gold watches better investment than steel watches?
The correct question is “which gold watches are better investment than steel watches?”. Investment is just a matter of how fast the value is growing. Some gold watches are slower than others. If we take a Rolex GMT-Master 1675/8 (8 is the Rolex code for Gold) in good condition, it can go up to 2X its value within 5 or 6 years. In a bad condition, it can almost remain at the same price. Now some brands are not worth investing in Gold models, but this is definitely not the case for Rolex, nor it is for Patek Philippe gold watches or Audemars Piguet Royal Oak Gold references.
Conclusion
The Rolex GMT-Master Gold watch is a good investment but you must ensure you purchase the good one. You must learn how to evaluate the condition of a gold watch, as well as you should learn all the Ins and Outs for any other investment source such as art or stock options. This is just a matter of backing the right horse after all and it involves a good control and knowledge, chance is not an option.