Passion & Money: Your Best Investment 2014 Fits on Your Wrist
Coutts Index reveals passion investments have risen 77% since 2005, outperforming shares
Classic cars rise 257%
Classic watches up 176%
Billionaire property doubles in value
Passion investments returned 77% (local currency terms)* since 2005, outperforming shares, according to the first edition of The Coutts Index: Objects of Desire. Launched today, the new Coutts Index aims to provide the global benchmark for monitoring the performance of passion assets.
The Index, developed in conjunction with Fathom Consulting, captures the price return in local currency (net of the holding costs) of 15 passion assets across two broad categories: trophy property and alternative investments. Alternative investments can be further broken down into fine art, collectibles and precious items.
Of all the alternative investments Coutts examined for the Index, classic cars have returned the most since 2005, rising by 257%, outpacing all other investments by more than 80 percentage points over the seven and-a-half-year timeframe. Classic watches have also proved they can stand the test of time, rising by 176% from 2005 to 30 June 2013.
Jewels returned 146% in comparison, while the standout performer in the fine art space is the traditional Chinese works of arts sector, which rose by 163% between 2005 and 30 June 2013.
Over the past seven and a half years, the Coutts Index, based in US$ terms, has risen by 82% – over the same period, the MSCI All Country Equity Index has risen by 53%, based in US$ terms.
The Coutts Index incorporates a real estate component supplied by Savills World Research. Trophy property comprises ‘billionaire’ residential properties in the ten prime global city locations and ‘leisure’ properties in the world’s most desirable leisure destinations associated with these cities. Both measures lost value in the run-up to the global recession, but billionaire property values have risen strongly since, rising 100% from 2005 to 30 June 2013.
Mohammad Kamal Syed , Head of Strategic Solutions at Coutts, said: “The Coutts Index has been created to measure passion assets, or objects or desire, in terms of performance, cost of storage and currency. But while many alternatives have provided spectacular returns, there is more to investing in these assets than price appreciation. For many people, profit is furthest from their mind.”
He added that for many ultra-high-net-worth individuals, it is less about investing and more about purchasing – purchasing assets driven by their emotions.
“The benefit is more than just profit. Owners can bond with like-minded people in an elite network, with assets offering escapism and a chance to re-enact history. Indeed, there is one thing that the Coutts Index, for all its robustness, can’t measure – and that is happiness. The idea of someone paying $50m for an uncomfortable old car, with windows that don’t work and a noisy engine, seems illogical. In many ways it is. But the happiness such a car can bring is immeasurable.”
Coutts commissioned articles and interviewed experts for its first edition of the Coutts Index. They included Stanley Gibbons, the world’s leading stamp dealer, Berry Bros. & Rudd, the wine merchant and auction houses Sotheby’s and Christie’s.
Quentin Willson, broadcaster and classic car specialist, looked under the bonnet of the classic car market. He wrote: “If you had bought a 1970s Ferrari Daytona for £50,000 in 2003, it would be worth £250,000 today. A 1960s Aston Martin DB5 bought for £60,000 a decade ago would now command £350,000.”
“The question is whether the classic car market has peaked. I’ve been wondering whether the bubble will burst ever since prices started to rise in 2009. But they have kept on rising and were up 27% in the first half of 2013.”
Nick Foulkes, author, historian and watch enthusiast, revealed why he has been fascinated with watches since he was a child. He wrote: “I can still remember writing an article in the 1980s, saying that the price of an old ‘Paul Newman’ Rolex Daytona was about to overtake the price of a new one. Now you will be lucky to find one for under £70,000.”
“But not all watches will burn a hole in your pocket. Rolex recently launched some particularly attractive Day-Date models with brightly coloured dials. These recalled the original ‘Stella’ dialled Rolexes and are now creeping up in value, but these Day-Date models can still be purchased for four figures. And I still think that vintage Cartier watches are hugely undervalued.”
Coutts is the wealth division of Royal Bank of Scotland Group. Coutts serves clients from over 40 offices across the world offering tailored wealth management, banking, trust and tax services. Coutts is headquartered at 440 Strand, London with offices in other key international financial centres in Zurich, Geneva, Hong Kong, Singapore and Dubai. The division includes Adam & Company providing private banking services from Edinburgh, and RBS International, based in the Channel Islands, which provides offshore banking.For further information please visit www.coutts.com
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Smart fashion is now a wise investment. – The hedge fund on your wrist.
Investment-quality timepieces gain popularity amid market turmoil.
The world’s economies and stock markets have come to resemble the house of horrors and roller coaster, but there is nothing amusing about the summer of 2011 for investors. Bonds yields are at record lows even after Standard and Poor’s historic downgrade of the USA’s credit rating. Precious metals have risen steeply and then nosedived. Demand for gemstones and ethical issues are causing doubt. All of this leaves you with few vehicles to protect the assets.
One shining ray of light in the darkness is the fine watch market. Unlike art and antiques, which require more expertise and carry more risk due to the volatile nature of the market, high-quality genuine watches are attracting investors interested in stability and an investment they can understand. Even those strapped for cash are benefitting from selling what was once strapped to their wrist.
Fashion is less of an issue with a timepiece because more people wear great watches than collect great art, and a beautiful timepiece is more likely than painting or sculpture to be regarded highly by future generations and become an heirloom. Experts in horology are relatively easy to find, and their value assessments are likely to be an accurate reflection of the real market value for a given timepiece.
Many news sources, finance pundits, and investment advisors are reporting that alternative investments are gaining in popularity, but investors find few categories they can trust in troubled times. Add the advantage of being able to wear an elegant timepiece that has an actual function and owning an investment-value timepiece becomes a very attractive notion.
Worldwide increased demand has made the stock prices of manufacturers and retailers high enough to be reported by numerous sources. The following articles mention the record high prices of auctioned art, antiques, and jewelry (including luxury watches), the rising stock prices of watchmakers and dealers, and the sale of watches by some who have been hit hard by the global recession:
AOL Daily Finance’s The Motley Fool – Is Fossil the Perfect Stock? – http://www.dailyfinance.com/2011/08/11/is-fossil-the-perfect-stock/
Bloomberg – Swatch First-Half Profit Rises 24%; Increases Hengdeli Stake – http://www.bloomberg.com/news/2011-07-28/swatch-first-half-profit-rises-24-increases-hengdeli-stake-3-.html
Bloomberg – Packard’s Vacheron Constantin Watch Triples to $1.8 Million at Christie’s – http://www.bloomberg.com/news/2011-06-15/packard-s-vacheron-constantin-watch-triples-to-1-8-million-at-christie-s.html
Bloomberg – Christie’s $5.8 Million Singing-Bird Pistols Lift Watch Sale – http://www.bloomberg.com/news/2011-05-31/christie-s-5-8-million-singing-bird-pistols-lift-hong-kong-sale-to-record.html
Boston Irish Reporter – Hangzhou store sales data: luxury half a year of links of London gold jewellery or surprising – http://www.bostonirish.com/node/15280
Chicago Sun-Times – Lou Gehrig items bring nearly $1M at Rosemont auction – http://www.suntimes.com/news/metro/6880321-417/lou-gehrig-items-bring-nearly-1m-at-rosemont-auction.htm
CNN Money – Pawning Rolexes to make payroll – http://money.cnn.com/2011/08/02/smallbusiness/small_business_loans_pawn_shop/index.htm
Yahoo! News – The Collections of Movie Icon Tony Curtis Are to be Offered at Julien’s Auctions in Beverly Hills – http://news.yahoo.com/collections-movie-icon-tony-curtis-offered-juliens-auctions-070858914.html
Cover image courtesy of Alon Ben Joseph
“Ever since I was a young boy, I’ve played the silver ball. From Soho down to Brighton I must have played them all,” so Roger Daltrey and The Who would tell you.
But for one watchmaker, this has meant an altogether different ball game. As part of a special charity auction this month, Christophe Claret has introduced the X-TREM-1 Pinball Only Watch 2013.
This special number is set to keep not only the time but the biggest of kids entertained thanks to its unique pinball style appearance.
So what’s so special about this bumper horological masterpiece? Just look a bit closer and you may be able to unlock the secret.
Small metal balls are represented by the hours and minutes while slingshots and tiny pinballs made of metal can also be seen inside the detailed mechanism.
In addition to this, the bright colours that incorporate both orange as well as blue reflect the true essence and personality of the pinball craze that swept the world almost as quickly as dear Scot, Susan Boyle.
But if you are looking to get your mitts on this nifty little number, then you will may just have to offer a shed load at the Only Watch charity auction.
This is in aid of AMM, the Monaco Association against Duchenne Muscular Dystrophy whose patron already has the royal seal of approval thanks to HRH Prince Albert II.
Time waits for no man or woman as they say but The X-TREM-1 Pinball has taken months of dedication and expertise in order to produce a sterling watch.
Their ethos is expressed in this simple to follow guide. For those of you who are au fait with Blue Peter (drumroll please) here is one I made earlier.
X represents experimental, T is for Time, R stand for Research while E is for Engineering and finally M corresponds to Mechanism. Now go away and learn it by heart!
So let’s get down to the details. What does the X-TREM-1 Pinball offer? It features titanium which is considered to be extremely lightweight not to mention a flying tourbillon which comes fully equipped with double ceramic bearings.
This ensures the maximum dependability and is set at 30 degrees to make it as clear as possible on the wrist.
When it comes to the mechanisms that can be found inside the dial, these symbolise the intricate details of an actual pinball machine which literally springs to life when it is wound.
Other highlights include a movement which is hand wound and a case exclusively made from white gold.
Now that the clouds have disappeared and you have a spring in your step this inspirational watch will have you reaching for the Monopoly or Hungry Hippos again.
Offering retro design not to mention a playful yet interactive timepiece, Christophe Claret is certain to turn many heads with this homage to pinball wizardry – even down to the word TILT which is etched at the top of the face.
Time to reach for that community chest.
Written by Simon Lazarus
“Alchemy is the art of liberating parts of the Cosmos from temporal existence and achieving perfection which, for metals is gold, and for man, longevity, then immortality and, finally, redemption…”
Courtesy of Hublot
On Thursday 15th December, in the Metallurgy department of the Hublot Manufacture in Nyon, Jean-Claude Biver, Hublot’s CEO, and Andreas Mortensen, a Professor at (Swiss Federal Institute of Technology Lausanne) unveiled a range of brand new alloys which are set to revolutionise the characteristics of precious materials and may also pave the way for new alloys to be used in the high-tech industry.
Jean-Claude Biver, Hublot’s CEO
Courtesy of Hublot
This presentation focused on a genuine “fusion” of 24-carat gold (the finest of the noble materials and a natural product) and the very latest in high-tech materials expertise. Almost three years of collaboration and research have gone into achieving this impressive result: a completely new type of noble gold, with patents pending and graded 18 carat by the Central Office for Precious Metals Control. Hublot’s 18-carat gold is the world’s first scratch-resistant gold, and as such eliminates the age-old vulnerability of gold and its alloys.
Courtesy of Hublot
Courtesy of Hublot
Hardness is a measure of a material’s resistance to indentation; doubling a material’s hardness means doubling the force required to produce a given indentation. Whereas “standard” high- quality 18-carat gold can reach 400 on the Vickers hardness scale, Hublot gold has a hardness rating of almost 1000 Vickers (most hardened steels are up to 600 Vickers). This makes Hublot gold the hardest in the world, and by some margin: it can only really be “scratched” by diamond.
Components made from this material are produced using a complex process: boron carbide powder is formed by cold isostatic pressing in moulds very close in shape to that of the finished part, e.g. watch cases, bracelets, bezels, etc. This ceramic – one of the hardest in existence – is also highly refractory: the preforms are then hardened at very high temperatures to create a rigid, porous structure without altering the shape. After this, molten liquid gold is injected under very high pressure. This operation is performed under inert gas pressure, at a sufficiently high temperature and pressure to ensure that the molten metal fills the pores in the ceramic, causing the two to “fuse” into a single new material.
Courtesy of Hublot
The resulting 18-carat Magic Gold must, like other 18-carat alloys, be composed of 750 parts pure gold out of 1000, but the inclusion of ceramic makes this gold scratch-resistant, unlike traditional 18-carat gold.
Courtesy of Hublot
Hublot has now passed the experimental stage for its new gold and acquired the means to produce the new material entirely in its own Manufacture, thanks to a high-tech foundry enabling processes such as refractory ceramic sintering and high pressure metal casting. The first watches made from Magic Gold was presented at BaselWorld 2012.
www.HUBLOT.com and @Hublot