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www777 · 14 August 2010, 01:36 AM

So what is the best value? Out of curiosity I ran the numbers. Gold just hit 1200 per ounce. A gold daytona I believe weighs around 200 grams and there are 31.1 grams in an ounce so the cost of the gold is around 7716. Assuming that rolex has a 25% margin (which we will never know) if you gross that up that is 10,288 for rolex to maintain their margin. Now if retail dealers get 40% if you gross that figure up to maintain the retail margin you get 17,146. So a gold daytona costs 20,000 more than stainless but the retail increase is 17,146. Not as big of a difference as I may have thought. Plus gold is supposed to be harder to work with so the 20,000 premium may be justified. Considering you can get a nice discount on the gold version and no discount on the ss version the gold may actually be a better value.

Now do similar math for a platinum watch that weighs 220 grams, platinum is 1525 per ounce and assumes rolex's margin is 25% and retail is 40%. That implies the value of platinum at retail is 23,971. The president in plat has a 40,000 plus premium over a ss one so here it seems like platinum watches are grossly over priced but gold versions may actually be fairly priced relative to ss versions.

What do you think of my logic? Everyone go out and buy gold versions...

Renoir · 14 August 2010, 01:49 AM

Interesting perspective...how 'bout one of each.

lifeis2short4aFTjob · 14 August 2010, 01:56 AM

Thanks for doing the math. YG is certainly a good buy. Well, if you like YG to begin with. However, there are so many people who prefer the look of SS that I don't see YG really becoming extremely popular. Also, the price is a detractor. If I could afford it, I'd definitely have an all YG Rolex.

hhh007 · 14 August 2010, 02:22 AM

<<< Gold just hit 1200 per ounce. A gold daytona I believe weighs around 200 grams and there are 31.1 grams in an ounce so the cost of the gold is around 7716. >>>

A gold Daytona is 18K gold which is 75% gold and 25% alloy. Also, the entire weight of the watch is not 18K gold, such as the movement, the crystal, etc. The actual gold melt value in a Daytona with gold at $1200.00 oz. is therefore quite a bit less than $7700.00 and probably closer to about $4200.00 - $5000.00 or so depending on the exact weight of the non gold components of the watch.

FremStar · 14 August 2010, 02:22 AM

Well as an owner of all three metals Datejust (116234), GMT II-C (116718), and Masterpiece (18946) I would say the best value would be cash in your pocket

. I agree GOLD is the way to go, however, for a daily wearable watch I would have to go the SS route! Nice assessment

Dan2010 · 14 August 2010, 02:36 AM

[QUOTE=hhh007;1994333]<<< Gold just hit 1200 per ounce. A gold daytona I believe weighs around 200 grams and there are 31.1 grams in an ounce so the cost of the gold is around 7716. >>>

A gold Daytona is 18K gold which is 75% gold and 25% alloy. Also, the entire weight of the watch is not 18K gold, such as the movement, the crystal, etc. The actual gold melt value in a Daytona with gold at $1200.00 oz. is therefore quite a bit less than $7700.00 and probably closer to about $4200.00 - $5000.00 or so depending on the exact weight of the non gold components of the watch.[/QUOT

Being an accountant by profession and a Chief Financial Officer of a company, I dig the financial analysis!

www777 · 14 August 2010, 03:01 AM

Good point re the percent of the watch which is gold. Still. It seems like platinum is way over priced and considering you can probably get a gold daytona at a 25% discount the gold analysis wasn't as bad as I thought. Even better pick up a used gold daytona and the difference is even less.

tulsaokusa · 14 August 2010, 03:10 AM

Historically, a SS Rolex holds its value better than both gold and platinum.

If more people thought like you, it might be different.

:-)

jeremyam · 14 August 2010, 03:37 AM

WWW777- thanks for your post but it seems like you've missed the most important component in calculating: hedging and contracts. You are correct in stating that Gold is priced around $1200USD per ounce, however, just because gold cost $1200 an ounce doesn't mean Rolex's cost is $1200 an ounce. Furthermore, as DAN 2010 has mentioned, the weight of the watch consists of the more than a precious metal. The movement as he accurately states, is not made of gold and makes up a substantial part of the mass.

I appreciate your post, however, I don't agree with your overall assessment and feel that by making your case you could mislead other members quite easily. I guess another critical importance is how to extract the valuable (precious material) from the watch without totally destroying the value of the watch itself.

Lastly, to close, you have to take into account that gold prices are the highest they've EVER been. Which means what? Well, if we look at the past two years, gold has spiked, but has been trending in this direction from the 90's and early 2000's when the price was in the $200-300 range- so we're currently looking at value SIX times what it was 10 years ago. So unless you're currently in possession of YG, WG, PLAT Rolex acquiring one now for the sake of the speculation isn't the best idea in my opinion.

buke45 · 14 August 2010, 03:40 AM

Quote:

Originally Posted by jasonsundberg

Historically, a SS Rolex holds its value better than both gold and platinum.

If more people thought like you, it might be different.

:-)

I agree 100% not only in the long term also in the short term.

George Ab · 14 August 2010, 04:36 AM

Yes, I also did the math with the Daytona. $10 worth of steel vs $7K of gold. The SS Daytona has a perceived value based on Rolex limited supply so a good used Daytona is $9K vice $10K list. For a gold Daytona used is $17-18K vice $30K. Additionally, you have a perceived rarity due to an artificial limited supply by Rolex with the SS and a real rarity due to limited buyers willing to part with $30K. I sold my SS Daytona and bought a used white gold Daytona. The difference in price of $7K is essentially the difference in the cost of the metals. Best of all it's gold, nothing like the feel and weight of gold; plus you got to love the Arabic numbers and a spot of red..... ooh, la, la. After all that is why we are WIS, because we love the look and feel; we have thrown out logic as we are willing to part with $10K for chronograph without a date.

ObscureLight · 14 August 2010, 04:40 AM

Quote:

Originally Posted by jeremyam

So unless you're currently in possession of YG, WG, PLAT Rolex acquiring one now for the sake of the speculation isn't the best idea in my opinion.

Even though steel models do tend to hold a stronger value percentage wise, it is really the rolex name and quality that gives it most of its value. I'm sure the steel costs rolex almost next to nothing. I think people should buy watches that they can see themselves wearing and being absolutely happy with. Resale value should be one of the last things to consider.

After all we all know that we are paying a high premium to rolex when we buy the watch. We will never get our money's worth material wise but that can be made up through satisfaction and happiness. After all in the scenario that rolex turns into a trash company due to bad marketing then horrible management and ultimately goes bankrupt , I doubt the SS models will sell for any more than $3000 bucks a piece and used will probably be $2000. However with gold and platinum models I guess you still have the actual value of the metal in the watch. (Unlikely scenario and the reputation that rolex has built will take quite a long time to destroy.)

sturgeon123456 · 14 August 2010, 06:16 AM

Quote:

Originally Posted by hhh007

<<< gold just hit 1200 per ounce. A gold daytona i believe weighs around 200 grams and there are 31.1 grams in an ounce so the cost of the gold is around 7716. >>>

a gold daytona is 18k gold which is 75% gold and 25% alloy. Also, the entire weight of the watch is not 18k gold, such as the movement, the crystal, etc. The actual gold melt value in a daytona with gold at $1200.00 oz. Is therefore quite a bit less than $7700.00 and probably closer to about $4200.00 - $5000.00 or so depending on the exact weight of the non gold components of the watch.

yep

rtkf · 18 August 2010, 09:57 AM

Depends on which model you get I suppose. If its a Day Date, it's got to be a yellow gold, .....and with champagne face and a stick dial.....this combination is timeless and stands the test of time......

Speed · 18 August 2010, 10:27 AM

Maybe it's me...but I like the look and feel of steel. Gold clashes with my platinum wedding ring... Might do white gold or plat someday, but enjoying my variety now!!!

The WG Daytona of George
AB is quite stunning though. Wish it came in stainless...hahahaha

HL65 · 18 August 2010, 10:35 AM

Give me platinum all day long! One factor for the cost of platinum watches is that less than 1% of all watches shipped from Switzerland are made in platinum versus gold and steel--not to mention the cost of platinum as a commodity versus gold of course.

tflyer99 · 18 August 2010, 11:06 AM

I am sure Rolex margins are way more than 25%. I wouldn't be surprised if a stainless steel Daytona costs Rolex less than 20% of the actual selling price to manufacture. It seems that the Gold versions of the Daytona margins are even greater based on the actual material cost of the metal versus the 30k retail prices.

14 August 2010, 01:36 AM	#1
www777 "TRF" Member Join Date: Sep 2008 Location: At Home Posts: 1,285	Ss vs gold vs plat? So what is the best value? Out of curiosity I ran the numbers. Gold just hit 1200 per ounce. A gold daytona I believe weighs around 200 grams and there are 31.1 grams in an ounce so the cost of the gold is around 7716. Assuming that rolex has a 25% margin (which we will never know) if you gross that up that is 10,288 for rolex to maintain their margin. Now if retail dealers get 40% if you gross that figure up to maintain the retail margin you get 17,146. So a gold daytona costs 20,000 more than stainless but the retail increase is 17,146. Not as big of a difference as I may have thought. Plus gold is supposed to be harder to work with so the 20,000 premium may be justified. Considering you can get a nice discount on the gold version and no discount on the ss version the gold may actually be a better value. Now do similar math for a platinum watch that weighs 220 grams, platinum is 1525 per ounce and assumes rolex's margin is 25% and retail is 40%. That implies the value of platinum at retail is 23,971. The president in plat has a 40,000 plus premium over a ss one so here it seems like platinum watches are grossly over priced but gold versions may actually be fairly priced relative to ss versions. What do you think of my logic? Everyone go out and buy gold versions...

14 August 2010, 02:22 AM	#4
hhh007 "TRF" Member Join Date: Jan 2010 Real Name: Howard Location: Midwest Watch: 18078 Posts: 604	<<< Gold just hit 1200 per ounce. A gold daytona I believe weighs around 200 grams and there are 31.1 grams in an ounce so the cost of the gold is around 7716. >>> A gold Daytona is 18K gold which is 75% gold and 25% alloy. Also, the entire weight of the watch is not 18K gold, such as the movement, the crystal, etc. The actual gold melt value in a Daytona with gold at $1200.00 oz. is therefore quite a bit less than $7700.00 and probably closer to about $4200.00 - $5000.00 or so depending on the exact weight of the non gold components of the watch. __________________ Day-Date Bark Finish 18078, TT Datejust Turn-O-Graph Oysterquartz 17013 Explorer I 114270

14 August 2010, 03:01 AM	#7
www777 "TRF" Member Join Date: Sep 2008 Location: At Home Posts: 1,285	Good point Good point re the percent of the watch which is gold. Still. It seems like platinum is way over priced and considering you can probably get a gold daytona at a 25% discount the gold analysis wasn't as bad as I thought. Even better pick up a used gold daytona and the difference is even less.

14 August 2010, 04:36 AM	#11
George Ab "TRF" Member Join Date: Aug 2009 Real Name: George Location: Seattle Watch: One of Them Posts: 6,924	Yes, I also did the math with the Daytona. $10 worth of steel vs $7K of gold. The SS Daytona has a perceived value based on Rolex limited supply so a good used Daytona is $9K vice $10K list. For a gold Daytona used is $17-18K vice $30K. Additionally, you have a perceived rarity due to an artificial limited supply by Rolex with the SS and a real rarity due to limited buyers willing to part with $30K. I sold my SS Daytona and bought a used white gold Daytona. The difference in price of $7K is essentially the difference in the cost of the metals. Best of all it's gold, nothing like the feel and weight of gold; plus you got to love the Arabic numbers and a spot of red..... ooh, la, la. After all that is why we are WIS, because we love the look and feel; we have thrown out logic as we are willing to part with $10K for chronograph without a date. Attached Images __________________

18 August 2010, 10:35 AM	#16
HL65 TRF Moderator & 2024 SubLV41 Patron Join Date: Dec 2007 Real Name: Ken Location: SW Florida Watch: One on my wrist. Posts: 64,008	Give me platinum all day long! One factor for the cost of platinum watches is that less than 1% of all watches shipped from Switzerland are made in platinum versus gold and steel--not to mention the cost of platinum as a commodity versus gold of course. __________________ *SPEM SUCCESSUS ALIT*

14 August 2010, 01:49 AM	#2
Renoir "TRF" Member Join Date: Dec 2009 Real Name: Renato Location: New York Posts: 2,396	Interesting perspective...how 'bout one of each.

14 August 2010, 01:56 AM	#3
lifeis2short4aFTjob Member Join Date: Jul 2010 Real Name: Mitch Location: DC-NYC Watch: Vntg TT DJ Oyster Posts: 145	Thanks for doing the math. YG is certainly a good buy. Well, if you like YG to begin with. However, there are so many people who prefer the look of SS that I don't see YG really becoming extremely popular. Also, the price is a detractor. If I could afford it, I'd definitely have an all YG Rolex.

14 August 2010, 02:22 AM	#5
FremStar "TRF" Member Join Date: May 2009 Real Name: Sam Location: Gotham City Watch: Wall Street Posts: 9,954	Well as an owner of all three metals Datejust (116234), GMT II-C (116718), and Masterpiece (18946) I would say the best value would be cash in your pocket . I agree GOLD is the way to go, however, for a daily wearable watch I would have to go the SS route! Nice assessment

14 August 2010, 02:36 AM	#6
Dan2010 "TRF" Member Join Date: Apr 2010 Location: South Carolina Watch: Panerai 914 Posts: 6,540	[QUOTE=hhh007;1994333]<<< Gold just hit 1200 per ounce. A gold daytona I believe weighs around 200 grams and there are 31.1 grams in an ounce so the cost of the gold is around 7716. >>> A gold Daytona is 18K gold which is 75% gold and 25% alloy. Also, the entire weight of the watch is not 18K gold, such as the movement, the crystal, etc. The actual gold melt value in a Daytona with gold at $1200.00 oz. is therefore quite a bit less than $7700.00 and probably closer to about $4200.00 - $5000.00 or so depending on the exact weight of the non gold components of the watch.[/QUOT Being an accountant by profession and a Chief Financial Officer of a company, I dig the financial analysis!

14 August 2010, 03:10 AM	#8
tulsaokusa Member Join Date: May 2010 Real Name: N/A Location: N/A Watch: 2010 SS/Black SubC Posts: 773	Historically, a SS Rolex holds its value better than both gold and platinum. If more people thought like you, it might be different. :-)

14 August 2010, 03:37 AM	#9
jeremyam Member Join Date: Jul 2010 Real Name: Jeremy Location: Toronto, Ontario Watch: 16610 V Posts: 511	WWW777- thanks for your post but it seems like you've missed the most important component in calculating: hedging and contracts. You are correct in stating that Gold is priced around $1200USD per ounce, however, just because gold cost $1200 an ounce doesn't mean Rolex's cost is $1200 an ounce. Furthermore, as DAN 2010 has mentioned, the weight of the watch consists of the more than a precious metal. The movement as he accurately states, is not made of gold and makes up a substantial part of the mass. I appreciate your post, however, I don't agree with your overall assessment and feel that by making your case you could mislead other members quite easily. I guess another critical importance is how to extract the valuable (precious material) from the watch without totally destroying the value of the watch itself. Lastly, to close, you have to take into account that gold prices are the highest they've EVER been. Which means what? Well, if we look at the past two years, gold has spiked, but has been trending in this direction from the 90's and early 2000's when the price was in the $200-300 range- so we're currently looking at value SIX times what it was 10 years ago. So unless you're currently in possession of YG, WG, PLAT Rolex acquiring one now for the sake of the speculation isn't the best idea in my opinion.

18 August 2010, 09:57 AM	#14
rtkf "TRF" Member Join Date: Dec 2009 Location: Calgary, AB Posts: 7	Depends on which model you get I suppose. If its a Day Date, it's got to be a yellow gold, .....and with champagne face and a stick dial.....this combination is timeless and stands the test of time......

18 August 2010, 10:27 AM	#15
Speed "TRF" Member Join Date: Aug 2009 Location: USA Posts: 19,706	Maybe it's me...but I like the look and feel of steel. Gold clashes with my platinum wedding ring... Might do white gold or plat someday, but enjoying my variety now!!! The WG Daytona of George AB is quite stunning though. Wish it came in stainless...hahahaha

18 August 2010, 11:06 AM	#17
tflyer99 "TRF" Member Join Date: Apr 2010 Real Name: Peter J M Location: New York Watch: Rolex Submariner Posts: 8	I am sure Rolex margins are way more than 25%. I wouldn't be surprised if a stainless steel Daytona costs Rolex less than 20% of the actual selling price to manufacture. It seems that the Gold versions of the Daytona margins are even greater based on the actual material cost of the metal versus the 30k retail prices.

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