Passion & Money: Your Best Investment 2014 Fits on Your Wrist

Passion & Money: Your Best Investment 2014 Fits on Your Wrist

Passion & Money: Your Best Investment 2014 Fits on Your Wrist

 

Coutts Index reveals passion investments have risen 77% since 2005, outperforming shares

The Coutts Index

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.

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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.

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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.

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“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.”

About Coutts

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

Follow on twitter: @couttsandco

Step Back in Time: Rado Musketeer VI Automatic

Step Back in Time: Rado Musketeer VI Automatic

As London swung their pants to the beats and sounds of the early 1960’s, the Rado Musketeer VI burst onto the watch scene.

With today’s models around the four figure mark such as the Jubilé and the Ceramica series, why not delve into the back of your wardrobe to see what’s lying around. Yet some models featuring high end baguette diamonds can fetch in the region of £100,000.

Diamonds are certainly forever as Shirley Bassey harped on about, but since the late 1950’s this Swiss watch maker has stood the test of time.

This is thanks to its innovation and high level of creativity which back in 1962 led Rado to bring out its first ever scratch resistant timepiece called the Diastar.

After this period, the brand were notorious for their diverse variety of materials including high tech ceramic and have even manufactured the world’s toughest watch known as the V10K.

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Although there’s no need for a shovel, let’s dig deeper into why the Musketeer should go straight into the vintage hall of fame. Get ready for that classic countdown theme pop pickers.

Well on first glance, the TV style aperture coupled with a host of bronze tones really evokes a golden period when The Waltons were just a bunch of baby faced television assassins!

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In addition to this the batons and hands are made from chrome while there is a nifty calendar window that includes both the day and date.

This particular Rado is resistant to any scratches and features a stainless steel bracelet not to mention acrylic crystal, a movement which boasts 25 jewels and a subtle 36mm diameter.

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Porthos and Dogtanian wait in line as this Musketeer oozes style and class. The patterned satin white dial radiates brightly and would make a fine piece of arm candy.

On the face of it (no pun intended) you can take advantage of a number of additional features such as a bevelled case made from stainless steel, a sunray grid and the “Musketeer VI” itself emblazoned at the 4 o’ clock mark.

Meanwhile, the Rado symbol is embossed for all to see not only on the fold over clasp but on the case back. This is all finished off with an impressive gold-filled bezel that definitely has the Midas touch.

Even back then clients were looking for a taste of the Swiss Family Robinson. Yet owning a Rado such as this was considered to be a status symbol even more than 40 years ago.

But what other timely events were happening around the world at the beginning of the 1960’s? This killer watch may have influenced the great Alfred Hitchcock as Psycho was released.

As the Musketeer VI Automatic grabbed the attention of many a watch groupie, the world was in crisis. So what’s changed you might ask!

In 1961, the Berlin Wall was constructed which was coupled with the infamous Bay of Pigs Invasion. Unfortunately what has stood the test of time is David Hasselhoff’s performance when the wall finally came down in 1989.

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Check it out here and watch out for the Hoff’s flashing leather jacket which no matter how hard the crowd clapped would not set alight.

1962 saw the Cuban Missile Crisis and the launch of one of the biggest movie franchises in cinematic history. How about another martini Mr Bond?

It was also the same year where events were shaken up with the death of iconic actress Marilyn Monroe and the first ever Wal-Mart store.

Watch out next time for…the Omega Chronostop Geneve 1970.

 

Written by Simon Lazarus