Dr. Ito's In-Depth Analysis of Mechanical Watches! Vol. 38 - The Relationship Between Luxury Watches and Trading Cards (Part 2)

Good evening, everyone!

Welcome to this column, where we discuss mechanical watches from an engineer's perspective. For our 38th installment, we'll continue our discussion from last time on:

"The Relationship Between the Luxury Watch Market and the Trading Card Market (Part 2)"

This will be our topic for today.

In the first part, we discussed the commonalities between both markets. In this second part, I'd like to discuss their differences and tips for enjoying collecting.

Differences between the Luxury Watch and Trading Card Markets

1. Time Horizon

The "time horizon" of asset value differs between the two markets.

Luxury watches tend to maintain their value over the long term and are often recognized as stable assets over decades.

On the other hand, trading cards are characterized by significant short-term demand fluctuations and volatile prices.

However, even in the luxury watch market, there have been instances where some models or new products experienced a sharp short-term price increase, followed by a rapid decline. Therefore, for those who prioritize stable asset value, it is recommended to choose vintage or semi-vintage luxury watch models whose value is already established.

2. User Base

Luxury watches are primarily for the wealthy and those who are conscious of their social status, while trading cards have a broad user base, ranging from young people to the general public.

Culturally, watches are associated with status and practicality, whereas cards are rooted in playability and community.

This difference can be said to directly reflect the disparity in "stability" and "volatility" between the markets.

To use a stock market analogy, luxury watches might be considered "stable stocks" or "large corporations with decades of history" that are recommended for long-term holding. In contrast, trading cards would be "mega-startups that have just gone public," with the potential for significant gains but also the risk of huge crashes.

The only commonality is that "male fans overwhelmingly dominate." If you peek into a watch store or card shop, you'll see almost exclusively male customers.

"Why spend millions on a watch when a smartphone does the job?" "Spending tens of thousands on game cards is ridiculous!" These are the complaints you might hear from women, or perhaps even have heard directly.

Daytona = Pikachu?

When collecting watches or cards, don't you think it would be more enjoyable to set a theme for your collection? For example, focusing on a specific model or buying cards from a particular era.

Let's look at a specific example: the Rolex "Daytona" and Pokémon cards featuring "Pikachu."

Both Rolex and Pokémon enjoy high popularity in their respective markets. Among them, these two, which are arguably the "faces of their brands," are known to have passionate fans, to the extent that there are collectors who specialize exclusively in them.

A commonality is that even relatively common models or cards can fetch high prices simply because they are a "Daytona" or a "Pikachu." Furthermore, rare and highly popular items like the "Paul Newman Daytona with manual winding" or the "Pikachu Illustrator" can command prices ranging from tens of millions to hundreds of millions of yen if they are in good condition.

The determining factors for price in both cases are "rarity," "condition," and "authentication (originality)." This means the evaluation criteria are very similar, and at this level, the customer base is limited to a segment of affluent individuals, which is another commonality.

What differs is the speed of price fluctuation. While the Daytona's value has gradually increased over decades, Pikachu's price surged rapidly in a short period over the past few years due to the influence of social media and auctions. This highlights the differences between the markets.

This is the Ref.116518LN, sometimes nicknamed "Pikachu."

Summary - A New Perspective: "Collection Investment"

Although luxury watches and trading cards originate from entirely different cultures, commonalities such as scarcity, authenticity, and the existence of a secondary market have led them to be discussed under the new category of "collection investment."

Luxury watches represent long-term asset preservation and a symbol of status, while trading cards offer short-term returns and a sense of community. Both fulfill people's "desire for ownership" and "sense of specialness."

In the coming era, investment and hobby options will become increasingly diverse. It might not be long before "Daytona" and "Pikachu" are discussed on the same playing field as stocks and real estate. Such a unique sight may soon arrive.

I hope this article has provided valuable information for everyone and sparked even a little interest in luxury watches! Also, if you have any questions, please feel free to ask directly, and we will be happy to answer them thoroughly. We look forward to your visit and inquiries.

Stay tuned for the next installment! See you then!