You may think of luxury goods – think an elegant Rolex or classy Chanel handbag – as well-deserved treats for working hard and saving up. However, these purchases can also be legitimate investments.
The luxury goods market has grown consistently and recovered quickly from the pandemic. We examine whether such goods are worthy additions to your portfolio, as well as your wardrobe.
What kind of investment are they?
A luxury good’s status as an investment can be defined in two ways. The first measures the item’s value based on its cost per use. In other words, the price of the good is averaged out by the number of times it is used – the lower the eventual cost, the better.
Take, for example, a cheaper but lower quality and/or trendy handbag, that might break easily or go out of style overnight, versus a more expensive one that will last for years and that you’ll enjoy using...