Often people will ask me what watch to buy and which ones are better to enjoy in the long run. I always counter with “It depends on what you’re trying to accomplish”. Do you just want to wear it because you love it, and don’t care about your return on investment? Do you want to have it as an heirloom to pass down to your children one day? Or are you just wanting to enjoy it for a while then trade into some other timepiece?
With so many options out there, I can see why the choice would be tricky. Most who don’t really know the luxury timepiece markets tend to go with what they know, which is Rolex. I’m personally not a Rolex fanboy, but I understand why they’re still the #1 luxury watch brand globally. With billions of dollars in ad spend and generations of history to boot, I can’t blame people for going crazy over their lineup, especially the professional sports models.
Today we’ll review two of the more popular sports models for a specific reason. I want to show you how to look at luxury timepieces as assets instead of just expenditures you splurge on because you simply “must have it”. Currently the state of the Rolex market makes it more challenging to pick up one of these models straight from an authorized dealer for MSRP sticker price. If you’re able to get them from a boutique, you should buy 10 of each. Kidding aside, there are ways to acquire brand new sport model Rolexes from authorized dealers without being on a ten year waitlist. In Watch Trading Academy, we show you how this is done. Let’s assume for the sake of this article you do NOT want to acquire a piece the traditional route, and want to buy one on the grey market pre-owned. Which watch would be the better choice?
If choosing solely on aesthetics, it’s entirely up to you. The GMT Master II is 40mm and the Sky-Dweller is 42mm in case size. So there is a little bit of a size difference. Both timepieces cater to the realm of flight and the travel enthusiast, but the truth is almost everyone admires these watches even if they aren’t a pilot. There is a way to tell which one is a smarter pick, especially from a trading and investment perspective. A great way to do this on any watch is to look at the fundamental market drivers (intrinsic value, demand, global economy, longevity), and then look at the technical drivers (% over MSRP, comps benchmarkers, discontinued?).
So let’s dive in. The intrinsic measure pertains to what inherently is in the watch that is valuable beyond the brand itself. So since both pieces are made of predominantly Oystersteel, they’re close to the same intrinsic value. The Sky-Dweller however, has white gold on the bezel, and so has an advantage when it comes to that category. Demand for both pieces varies slightly, but overall the Rolex Pepsi on jubilee bracelet is more in demand than the steel Sky-Dweller. The variants are the white and black dial Sky Dwellers being referenced here. The blue dial steel Sky Dweller is a clear favorite and comes at a premium to both of these watches so it’s not being included. One can use the same types of analysis to determine if it’s a solid investment still though. The global economy is keeping both of these Rolex pieces holding strong and appreciating in the long run, so even if there is a slight market correction later in 2021, they will surely rebound seeing as both have similar prospects of lifetime value. This means they have similar longevity in the marketplace.
After assessing the fundamental drivers, we’re still neck and neck between the two watches. So let’s take a look at the technical factors to see where we stand. The GMT Master II 126710 BLRO has an MSRP sticker price of $9,700 USD. The Steel Sky-Dweller has an MSRP sticker price of $14,800. Where the current secondary market sits today, that means the GMT is trading hands at 2.1X over MSRP, and the Sky-Dweller is at only 1.35X over MSRP. Add in the fact that the original brother, the gold Sky-Dweller, is continuing to increase in value and is $25K+ more shows that the steel version has a stream to follow. Whereas the GMT Master II is sitting by itself with the vintage model price more aligned to the MSRP price. So when you look at these types of data points, you have to see it for what it is. The GMT Master II is inflated, and the Sky-Dweller is still a solid buy. I always tell people that betting on a piece strictly due to color, or “hype” demand is not wise.
So look at multiple data points and factors when coming to a decision on what the best piece is for you to buy next. If you don’t care either way, that’s okay of course, but I would say if you can have your cake and eat it too why wouldn’t you!?
If you want to learn how to make these assessments on any timepiece easily, join us in the Watch Trading Academy where over 15,000+ enthusiasts are learning how to enjoy these beautiful timepieces as assets. We’ll show you step by step how to get your favorite Rolex either direct from an authorized dealer without having to be on a wait-list or pick one up pre-owned at a price you can’t lose at.