Luxury Watches as an Investment

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A Bevy of Winners

Sky Moon Tourbillon is Patek Philippe's most complicated wristwatch, featuring a sky chart and moon phases and orbit. It currently retails for about $1.2 million, and only two pieces can be made each year. In 2008, one of the timepieces from 2003 fetched $1.5 million at Sotheby's in Hong Kong. The head of the company handpicks the buyers.

A lower-priced example is The End of Days model from the Royal Oak Offshore collection by Audemars Piguet. Produced to mark the release of Arnold Schwarzenegger's film End of Days, it retailed for $13,600 in 1999. Last spring the company resold one piece from the edition of 500 (which sold out) for $85,000.

In 2008, several models by F.P. Journe, a Swiss maker that produces about 950 timepieces a year, fetched more at auction than their original retail prices. The 2005 "Vagabondage" collection comprised 69 platinum wristwatches, each priced at 54,800 Swiss francs ($51,844). In 2008, one piece from the edition sold for 81,600 Swiss francs ($77,199) at Antiquorum Geneva.

The platinum model of German maker A. Lange & Söhne's Tourbillon "Pour le Mérite tourbillon", manufactured in 1996, fetched 315,000 Swiss francs ($262,740) at Christie's Geneva in 2008. It retailed for $103,000 before the entire edition sold out.

Watches by Greubel Forsey, a maverick Swiss brand, are so intricate that the company makes only 150 items a year. In December, its handmade Invention Piece One model from 2007 fetched $459,240 at Christie's Hong Kong, establishing an auction record for the brand. Only 11 were made. The piece's auction tally was on a par with its original store price of $460,000, even as some retailers were offering 15% discounts on high-end watches.

"It's outstanding to bring that kind of a return on a watch that is still in production," says Roberto Chiappelloni, owner of Manfredi Jewels, which sells Greubel Forsey and other luxury brands to hedge fund managers in Greenwich, Conn. "It's an amazing piece of architecture for the hand."

Typically, "if you want to sell a new watch and realize a return on your investment," he says, "you have to wait about 20 years."

Click here to view some of the world's most expensive watches.

Katya Kazakina is a reporter for Bloomberg News.

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