Vintage Investing, Vintage Profits?

Vintage Investing, Vintage Profits?

Anything vintage is widely regarded to be the best in its class. For instance, when talking about vintage stocks, the first thing that comes to mind is blue-chip companies that appreciated in value. The likes of Apple Inc. (NASDAQ: AAPL), Alphabet Inc. (NASDAQ: GOOG), Amazon.com Inc. (NASDAQ: AMZN) and Microsoft Corporation (NASDAQ: MSFT) and the list is long, and a lot varied than the few names mentioned above.

These stocks, among several others quality companies, also make up the list of CFD-tradable stocks on many brokerage platforms. Brokers are traditionally stricter on smaller companies being part of their list of available CFDs. Quality attracts more investors meaning that blue-chip stocks are highly liquid, which makes them ideal for CFDs.

But what really is vintage investing?

Vintage investing does not stop with buying blue-chip stocks. It encompasses a far wider market than just stocks. For instance, Etsy Inc. (NASDAQ: ETSY) describes itself as an e-commerce marketplace for vintage goods. Such include archaic artworks, handmade goods and many more.

However, over the years, vintage investing has been more about buying things that stand out from the rest rather than investing in quality stocks. Supercars, for instance, have historically been among the best vintage items to invest in while others prefer wearable items like jewelry and watches.

So, supercars

This may not sound like something that you would associate with investments because the general view out in the world is that people who buy these expensive products, sometimes popularly referred to as ‘collectors’, buy them for luxury. However, some of these items as mentioned in the previous paragraph, supercars, tend to appreciate in price with age. So, the older they become, the more expensive they get.

And just to illustrate how profitable investing in supercars can be, this article published by The Telegraph a few years ago puts things into perspective. Investing in rare cars, in this case, supercars can result in huge profits. For instance, the article notes that the price of a Ferrari LaFerrari more than doubled between the years 2014 and 2015. This clearly shows why investing in collectors’ items could be one of the best forms of investing.

Luxury watches?

The same thing applies to luxury watches. In this case, one type that stands out from the rest is the Rolex watch. Some people believe that if a person reaches the age of 50 years without ever owning a Rolex watch, then it is probably a sign of failure in their life. However, many vintage watches have emerged over the years, some even more expensive than the traditional Rolex watch. Brands like Hublot, Michael Kors, and Patek Philippe have launched their own vintage watches that cost a lot more than their Rolex counterparts.

Some watches cost millions, but that is mostly down to the number of diamonds and gold used in them. This does not necessarily lock out those who are not wealthy enough to spend millions on a watch. Top brands like Seiko, Armani, Diesel, and Rotary, among others, provide interested investors with varied options that fit their budget. For instance, a quick search for these brands at Tic Watches shows that investors can buy their preferred brand from as low as a few hundred US dollars while those looking for a little bit of class there are some that cost a few thousand.

One interesting fact about luxury watches is that most of them never depreciate in price. The price always goes up even when the global market is experiencing a recession. For instance, this article published on Business Insider, shows the price appreciation of the Rolex watch over a 60-year period, dating back to the 1950s. During this period, global markets experienced recessions causing major crashes in the stock markets. However, the price of the Rolex watch and many others continued to climb, rising from $150 or ($1,265-inflation adjusted) in 1957 to $7,500 in 2014.

And just for comparison, the S&P 500 gained about 177% between 1996 and 2014. In 1996, one Submariner (No-Date) Rolex watch model 5513/14060/14060(M) cost $2800 according to the Business Insider article, which implies a gain of about 168% during the same period.

Conclusion

It is correct to say the difference isn’t that much. However, when you factor in the stock market crashes and the fear, stress, and anxiety that comes with it, it could have been better for some investors to opt for the steady returns presented by investing in vintage products. After all, how many investors get it right in the stock market? It could be a good time to consider putting some money in vintage products. It is hard to predict when the next recession will hit the market.