Speech is silver, gold watches are gold

Speech is silver, gold watches are gold
Gold flies to the sky, stocks head for the basement, and gold watches remain the safe haven for capital preservation—with potential.

It has hardly escaped anyone’s attention that gold has been soaring. In fact, since November 2022, it has risen by 75%. Gold has always been the preferred refuge in uncertain times. Central banks are buying up massively, and many large professional investors are following their lead. This dynamic is driving the significant increase in gold prices during unstable periods. Despite rumors of peace in the three-year war in Ukraine, the world fears peace negotiator Trump’s next move just as much—especially with his newly announced “tariff war,” self-initiated invasions of foreign territories, and who knows what’s next. Gold has become the answer to uncertainty…

But what’s the right position when it comes to buying gold?
The most common approach for private investors is to buy physical gold bars, CFDs, a spot price gold ETF, or other assets that track the price of gold. An alternative to buying gold could be investing in mining stocks—or our favorite: gold watches.

At the beginning of January, Rolex introduced its annual price increases. The biggest jump was in gold Daytona models, which rose by 14%. This was primarily justified by rising gold prices, which in 2024 increased by 29%. That trend has continued well into 2025, with gold already up 17.8% just about three months into the year at the time of writing. Gold hasn’t had a better quarter since 1986! This suggests that the market expects further price increases for gold watches. If you view gold prices as a leading indicator of retail prices for gold watches, it’s only natural to expect rising demand on the secondary luxury watch market.

Gold is the rocket, Rolex is the safe harbor, and stocks are being thrown out with the bathwater

If you compare the gold price and the PE ratio of the S&P 500 with the price of a gold watch, it’s clear that there’s a disparity in what you get for your money for essentially the same item over time. Most people understand the markets, but here’s a visual comparison of stocks (S&P 500, S&P 500 PE, and C25), measured against the price of gold and Rolex as an index (weighted by all traded models). The data covers 2017 to April 3rd, 2025.

Of course, there’s much more than just the material value of gold involved in buying a high-end luxury watch. But with gold surpassing $3,000 per troy ounce (approx. 31g) and setting new all-time highs almost daily this year, one can no longer ignore the fact that a gold Submariner at 296g has real material costs. Value appreciation is typically a bit slower for gold watches than other gold-exposed assets. We can even expect that price increases may come 6–9 months later, once the market realizes that the new models—those you can’t even get on a waitlist for—are rising sharply due to production costs and the current surge in demand for gold.