I recently got a new Garmin smartwatch, and it’s an amazing device…
It monitors my heart rate, sleep patterns, and other health metrics. It tracks my surf sessions through onboard GPS. It even alerts me whenever I have a new e-mail or text message.
But there’s one thing it won’t do: Hand me the type of inflation protection I get from my trusty 1998 Rolex GMT-Master.
Indeed, while I expect the Garmin will be a useless piece of junk several years from now, my Rolex will probably keep rising in price.
And that holds an important lesson for anyone looking to thrive in today’s environment…
Why Luxury Watches Are Beating Many Traditional Investments
Rolexes and other luxury watches are an enduring symbol of wealth.
But they’ve become more than that… They’re also a store of wealth.
And in today’s economy, they’ve been generating returns that outpace most traditional investments.
Take my GMT-Master… It has a black “Swiss only” dial and the famous two-tone blue and red “Pepsi” bezel, originally designed for Pan-Am pilots.
It was about $2,500 when I bought it new in 1999.
A year ago, well-known dealer H.Q. Milton was selling a very similar model for $13,250.
Right now, another well-known dealer called Bob’s Watches is asking $15,500 for one in worse condition than mine.
That’s more than six times my original purchase price over 23 years… And I’ve been wearing this watch the entire time.
Funny enough, collectors actually prefer scratches, scrapes, and even the faded bezel over models that have been polished or altered in other ways.
So I’ve enjoyed using and wearing this tool for more than two decades, and I’ve increased my original investment by six times along the way.
And this is not a unique example…
Based on data from Bob’s Watches, pre-owned Rolex watches as a broad category have doubled in price over the last 10 years. Every single Rolex model has risen to all-time highs since 2011.
All told, Rolex watches have outperformed gold, real estate, and the stock market over the last decade.
Now, you may be wondering why I’m telling you a story about expensive Rolex watches – especially if you’re not a collector. But as I’ll show you below, the smart money is piling into what we call “trophy” assets…
Here’s Why Rolex Watches Continue to Soar in Value
Trophy assets are valuable, tangible things like vintage cars, wine, real estate – and even certain crypto-related assets – that are skyrocketing in price due to the Federal Reserve’s unprecedented money-printing and the inflation that’s followed.
Trophy assets grow ahead of the inflation curve. So the wealthy buy them to protect their purchasing power. We like them because they offer the not-yet-wealthy the chance at life-changing gains.
Now, as a category of trophy assets, Rolex watches aren’t necessarily rare.
Although it closely guards its production numbers, the company likely produces more than a million watches every year.
However, the market is huge and well-established. Demand continues to outpace supply every single year. And there is a fanatical fanbase.
So in a world where prices for daily items are skyrocketing, the smart money continues to rush into anything that will stay ahead of the inflation curve – especially trophy assets.
NFTs (non-fungible tokens) are just the latest example. If you’re not familiar with NFTs, they’re simply proof of ownership of a digital asset that’s verified by a blockchain.
(Some of the most famous and expensive NFTs are simply digital images, such as the CryptoPunk and Bored Apes series. One CryptoPunk NFT recently sold for nearly $24 million.)
And just like a highly sought-after Rolex, they bring an element of privacy and portability that can only be found in a handful of other assets.
Just think about it: I regularly walk around with more than $15,000 on my wrist and only watch geeks really take notice. (I often wear mine on a $13 nylon NATO strap, which further tones down the bling factor.)
I could easily hop on an airplane, fly to just about any major foreign city, and quickly exchange my watch for the local currency or precious metal..
My point is simple, and it’s one that Daily editor Teeka Tiwari drives home all the time…
For every reason, it pays to have some part of your wealth in alternative assets right now.
They can help you stay ahead of the massive money-printing happening around the world. They can move independently of other asset classes like stocks and bonds.
They can provide levels of privacy and portability far beyond most traditional vehicles. And even a relatively small amount of money can end up producing outsized gains.
In the case of my watch, my original investment has doubled every four years on average.
But you can find even bigger gains in the crypto and NFT spaces…
For example, Teeka recommended bitcoin for around $400 in 2016. Today, it’s up more than 13,900%. That’s enough to turn every $1,000 into $140,000.
And in the world of NFTs, blue-chip assets like CryptoPunks and Bored Apes have delivered even bigger gains in far less time.
Don’t Have Enough Money to Buy a Rolex? No Sweat!
These days, you don’t even need to be rich to invest in some of the world’s most coveted trophy assets.
For example, platforms like Rally now allow just about anyone to purchase fractional ownership interests in Rolexes, Lamborghinis, and even CryptoPunk NFTs for $10 or less.
Here’s how it works…
With a fractional investment, the owner of an asset can list it on a platform… and offer shares (or fractions of the asset’s worth) to investors.
For example, you could list a rare baseball card worth $100,000 and offer investors $100 fractions of it. If the baseball card’s value rises to $1 million, that $100 investment rises to $1,000.
Platforms can offer these fractional investments because they’re classified as Regulation A+ listings.
Reg A+ deals allow private companies to raise money from accredited and non-accredited investors. And companies can use them to fractionalize assets like vintage cars, rare artwork, and even digital collectibles.
More importantly, when companies fractionalize assets through a Reg A+ listing… they’re SEC-registered investments.
That means these investments have federal oversight. So you have more financial protection than you might get through crypto exchanges and other online marketplaces.
You can also buy these shares with cash. So if you want to invest in an NFT, you don’t have to convert your money into ether (ETH) or any other crypto to get a stake in it.
It’s the perfect way to speculate on the hottest digital art without having to commit serious amounts of time, effort, or money.
Several platforms make it extremely easy for you to get started. And we’ve named two of the best in our flagship publication, The Palm Beach Letter.
These same platforms offer liquidity and transparency. And they give you broad exposure to the tremendous upside in trophy assets.
(Perhaps the only real downside is that you don’t get to enjoy the items the same way I enjoy my trusty GMT-Master…)
So if you’re looking for an easy way to protect the value of your wealth from rampant money-printing and inflation, investing in trophy assets like a Rolex or an NFT is a great place to start.
Analyst, Palm Beach Daily