I’m not making a case that vintage Rolex pieces are an investment but I foresee the problem for the market within which these pieces gain value and lose value alternatively.
I believe the gross market is capped by a relatively small amount of collectors (compared to the total market of Rolex buyers). When that happens money will move between choices with some selling of less attractive pieces below the highs they had reached earlier. This is the case for bubbleback retreating due to collectors cashing in their gains on them to fund acquisition of the current “hot buys”.
If the market had new money coming in, then highs across the board could be possible. But I believe it is a relatively closed system of selling/buying. As a result, and with inventories being fixed, values respond in a highly correlated elastic manner. This is unlike a market with many new entrants where prices can respond differently.
Going back to bubblebacks for a minute...
It might be possible to float their values upward without diluting the values of other vintage models. I agree their size currently hurts values among the collectors who are, by-and-large, male.
But if a female luminary began sporting a few of them, and doing an interview here or there about their historic connections - then it might drag in a lot of new money because the size isn’t as much of an issue.
I call that type of new money phenomenon the :BTC: Bitcoin effect. :BTC: brought many new buyers into a market who weren’t commodity, currency or equity investors. The new entrants had just been consumers spending wads of cash on millennial toys and baubles. The value of other products in the currency markets didn’t dip a jot due to the new :BTC: buyers because that market’s long entrenched investors/speculators/hedgers stayed put within their comfort zone on existing products.
So bubbleback owners may still see gains if some influencer decides to flaunt/hype them online. “Calling All Kardashians” may be your best strategy!
All just my 2¢ (yeah, ¢ - no :BTC: in my pocket)
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