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
Follow on twitter: @couttsandco
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
By, Alex Ghotbi originally posted on The Hour Lounge
1972 was obviously a fantastic year, Coppola released one of all times greatest films : the Godfather (which by the way is the only time in cinematographic history where a film and its sequel received the Oscar for best film), David Bowie created Ziggy Stardust, Atari launched its 1st video game and Vacheron Constantin receives the Prestige de la France award and goes on creating a watch in its honor.
It was a Friday afternoon in the salons of the Ritz Hotel, on Place Vendome that Jacques Ketter received on June 23 1972 the Diplome du Prestige de la France from the hands of the president of the Comité de Prestige et de Propagande Nationale (Committee of national prestige and propaganda) you have to love the name – for its technical excellence – being the first watch firm to receive this honor.
It is however rather blurry as to know if Vacheron Constantin created a specific timepiece to celebrate this diploma or had a piece in the pipeline that it called Prestige de la France, in any event we know that the reference 35202 was designed by the brand’s Paris team which can explain such an original and zanzy design in a period where the VC production design wise was on the verge of a flat encephalogram!
This model stayed more or less the same until 1999 when it was redesigned, retaining its asymmetrical case but less elongated. With time the 1972 evolved into a ladies watch hitting an amazing high in 2002 celebrating its 30th anniversary with a set of unique models whose straps were made by embroider extraordinaire François Lessage.
For its 41st birthday (why 41 and not 40 may you ask – and I have no answer) Vacheron Constantin launches a redesigned version of the 1972 dubbed 1972 Prestige, finally available once again to men and I had the pleasure of wearing it for a week for this review.
With a 25mm x 47mm case the new 1972 Prestige is extremely close to the original model with a slighter width, says Vincent Kauffmann design Director “We wanted to have a nice curve on the case as well as an elegant and sleek line, the bigger size also is due to the fact that we wanted it to be more in line with today’s tastes and masculine size while retaining its sophistication.”
At first glance the case my look simple with the major interest being its asymmetrical case but the lines, angles and steps give it an amazing form when looked closely and reflect the light in an extremely complex yet interesting manner with a succession of light and shadows. This also comes from the fact that the dial opening takes up all the width of the case but leaves a lot of metal at 12 o’clock and 6 o’clock.
Another superb feature is the grey dial with a subtle blue herringbone motif. Says Vincent Kaufmann: “we wanted to create a dial bare of ornamentation yet with some type of pattern. Considering that the timepiece is a true dandy’s timepiece we wanted to recreate a fabric patter found in men’s apparel and the herringbone was the perfect pattern”. The choice of rose gold hands and Maltese Cross is in my honest opinion a winning choice and give a hint of warmth where monochromatic silver hands would have left the dial cold.
Movement wise, the newly launched extra slim Cal 1003 in gold is the engine of the 1972 Prestige.
As the new Geneva Seal now applies to the whole watch and therefore and even greater attention needs to be taken in the attachment of the movement to the case and a very elegant and aesthetic movement holder has been created to encase the cal 1003 to the case.
So what’s my take after a week on the wrist?
God this watch is beautiful and it grew on me more and more each day, depending on the angle of the wrist the reflections were completely different and I had the impression of having a different watch each time. The slightly cambered case makes the watch sit perfectly on the wrist and thanks to the strap which is screwed into the case the fit is perfect.
The original 1972 on the wrist
The 1972 Prestige is a true dandy’s watch, it will look as good with a bespoke Anderson & Sheppard suit or with a dash of Neaopolitan spezzatura from Rubinacci but definitely not on more casual wear.
The only question I may have on the 1972 Prestige is linked directly to its design will this design which is really bold and audacious become rapidly outdated or will it stand the test of time and become one of those designs which will be lauded in fine art schools? I tend to think the latter because the harmony of the proportions is just perfect. More often than not when I see a watch I always find something which could have been bettered to suite my tastes but with the 1972 I find no flaws!!