New Delhi, March 14 (SocialNews.XYZ) In the latest edition of Knight Frank's flagship 'The Wealth Report 2023', which tracks the value of ten investments of passion, has increased by a healthy 16 per cent during 2022, comfortably outpacing global inflation rate whilst outperforming majority of mainstream investment classes, including equities and gold.
The top-performing asset, as measured by the Knight Frank's Luxury Investment Index (KFLII), was art, which generated a return of 29 per cent over the course of a year concluding in December 2022. Then came classic cars, whose success last year was revved up by a 25 per cent YoY increase in 2022, the highest in the previous nine years. A Mercedes-Benz Uhlenhaut Coupe, for instance, established a record for the most expensive vehicle ever sold in 2022 when it sold for US$ 143 million.
Watches took third place on the luxury index list with 18 per cent annual appreciation on investment. "The watch market at the top three auction houses grew 33 per cent in 2022 to a total of 475 million Pound. This included 40 watches that sold for over 1 million Pound, 12 more than the previous year," points out Sebastian Duthy of Art Market Research. He further stated that, the market is however being led by a small number of models.
Luxury Handbags, wines and jewellery slipped from their earlier top positions to 5th, 6th, 8th respectively in 2022.
Andrew Shirley, author of the Knight Frank Luxury Investment Index said: "The results of our index and some of the staggering sums paid for investments of passion over the past 12 months highlight just how important their collections are to UHNWIs and how resilient many of these asset classes are to economic and geo-political events. Gen Z and Millennial wealth is also having a profound impact with new collectable markets emerging all the time."
Investment of passion - Attitudes survey
The Wealth Report 2023, which conducts an extensive survey across markets globally, also released its 'Attitudes Survey' which points out that approximately 53 per cent of ultra-wealthy in India are likely to purchase art amongst passion led investments along with watches and luxury handbags, followed by jewellery at 41 per cent. Classic cars came in as the fifth most preferred investment of passion with 29 per cent respondents showing preference to purchase one in 2023. These investment asset classes have been performing well over the global index which has led to many UHNWIs to continue their investments. Globally, art (59 per cent), watches (46 per cent) and wine (39 per cent) make up the top three categories of passion led investments.
Shishir Baijal, Chairman and Managing Director, Knight Frank India said, "India's wealthy have always had a penchant for collectibles across categories, however traditionally these were mostly for conservation, rather than investments. With the domestic and global market offering significantly higher returns for such article, Indian ultra-wealthy are actively seeking investment opportunities in passion led investments. The demand for rare articles has been rising across different generations in India and with rise in wealth in India, we can expect more investments in these asset categories."
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