Don’t go ditching your 401k just yet.
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A new study is making the rounds online, claiming that an Hermès Birkin bag is a better investment than stocks and gold. But it doesn’t really make sense.
The claims come from online luxury bag reseller Baghunter, which incidentally, invites readers to view its collection of “rare” Birkin bags at the top of its study. Baghunter compares returns on the S&P 500, gold and Birkins since 1980, when the bag was first produced, ultimately concluding that ahead of a potential global recession in 2016, the bags are “the safest and least volatile investment market.”
Theoretically, it makes sense that a $10,000 Birkin is likely to retain its value and potentially appreciate in the future given the bags’ tight distribution and history of popularity, kind of like a famous painting or special antique. But it’s not really comparable to a popular commodity or the stock market.
The market for Birkins is absurdly small compared to stocks and gold
The websites that claim it’s super easy to resell a Birkin at or above its original purchase price didn’t even exist a few years ago, and may not exist a few years from now. And while the S&P 500 and gold have good and bad years, the size of each market is in the trillions and you can buy or sell instantaneously.
Thanks to the size of the stock market, if Apple shares are priced at $100 each, that’s the price you’ll be able to buy or sell them at. There’s no such guarantee when it comes to rare handbags, and the returns cited by Baghunter don’t take into account how easy it was to find a buyer, or the hassle of haggling over prices with a buyer or reseller.
Mehdi Fedouach / AFP / Getty Images
Investing in Birkins means you have to buy and sell in units of at least $10,000 which makes zero sense for a regular person
You can’t buy or sell half a handbag.
Robin Beck / AFP / Getty Images