UBS Global Wealth Report - Luxury Watch Edition

Asset-rich, cash-poor millionaires. A $9 trillion wealth transfer to women. Currency chaos crushing purchasing power. The UBS data explains why the watch market feels broken.

Jan 14, 2026

Every year, UBS publishes their Global Wealth Report, and every year I usually skim it, roll my eyes at some big numbers, and kinda move on. This time was a little different; I will openly state that perhaps some confirmation bias was at play here, but you can judge that observation for yourself at the end.

If you’ve been following SDC for a while, you’ll know I’ve been banging on about bifurcation, the K-shaped economy, and the polarisation of wealth for many months now. The UBS report basically validates a lot of these claims, but it gets even better, because when you overlay the data in this report with what people in the community are observing about watch prices being too high, it helps us make (some) sense of why everything feels so expensive right now.

Estimated reading time: ~13 mins

The Rise of the ‘EMILLI’

Like you, I had never encountered this acronym before; I thought UBS coined the term but then I found mentions of it elsewhere, prior to the report being published. Anyway, I rather like the term EMILLI, or ‘Everyday Millionaire’.

These are individuals with assets between USD 1-5 million; globally, there are ~52 million of these up-and-comers, and collectively they control around USD 107 trillion in wealth (which is almost as much as everyone worth more than USD 5 million combined, at USD 119 trillion!).

Why should we give a fvck? Well, this segment has exploded in size over the past decade, and the primary driver is real estate appreciation. This tells us that many EMILLIs didn’t actively build their wealth through entrepreneurship or aggressive investing; they just bought property at the right time and watched it appreciate.

The implication here is subtle but no less important; these aren’t necessarily people with sophisticated financial portfolios or high disposable income. In fact, they may be asset-rich but are quite often, cash-poor. An Australian EMILLI, for instance, holds roughly 53% of their wealth in real estate and only about 10% in cash or deposits. Compare that to Swiss or UK millionaires who hold nearly double that percentage in liquid assets.

For the watch industry, this creates what I’d like to dub a ‘liquidity paradox’. You might have a million dollars in net worth, but if most of that is tied up in your house or whatever, you’re not exactly flush with cash to drop on a new watch. This goes a long way towards explaining why entry-level luxury and mid-tier watches have been struggling so badly over the past few years. The people who should be buying them on paper, are in fact feeling squeezed in real life.

Cash-Rich vs Cash-Poor Millionaires

The US stands out because American millionaires hold nearly 40% of their wealth in financial instruments like stocks and bonds. That’s the highest in the sample. When the S&P 500 goes up, American discretionary spending on luxury goods tends to follow almost immediately. This financial wealth concentration is why US retail has been so resilient - even as China has collapsed.

Meanwhile, markets like Australia, France, and much of Southern Europe are heavily weighted towards real estate. Their millionaires might look wealthy on paper, but their actual liquidity for discretionary purchases is much lower.

This dynamic probably contributes to the regional divergence we’ve been seeing in Swiss export data. The US has, especially before the tariff drama, been carrying the industry on its back precisely because American wealth is relatively more liquid and more exposed to financial markets that performed well in 2024 and into 2025. If you recall from previous SDC Weekly posts, the US eventually overtook China (in Swiss watch exports) for the first time since 2005.

The flip side is that any significant tech correction would hit American watch demand disproportionately hard. Silicon Valley’s top 9 households control USD 110 billion in liquid wealth, and Bay Area luxury home sales above USD 5 million rose 82% in Q1 2025 (directly driven by AI wealth creation). A 20-30% tech recoil wouldn’t just affect “Silicon Valley collectors”… no sir, it would majorly ripple through the entire US luxury watch market. (As an aside, Owenomics just wrote We are NOT in an AI Bubble, so there’s that!)

Safe Haven Shift

Given the liquidity constraints facing many EMILLIs, I think we might see an interesting shift in how this cohort views watches. Consider if your net worth is heavily concentrated in real estate, and real estate growth starts slowing or becomes volatile - what alternatives do you have for wealth preservation? Obviously financial instruments are an option, but some EMILLIs may increasingly view ‘blue chip’ watches as portable stores of value.

A Rolex Daytona or Patek Nautilus offers something property doesn’t, and that’s instant liquidity, global price discovery, and given that WW3 is always looming… physical possession. You can sell a Rolex anywhere in the world within 48 hours1. Try doing that with an ‘investment flat’ in Sydney.

I’m not suggesting watches are good investments in the traditional sense. We’ve covered that debate extensively on SDC, and the secondary market data speaks for itself. But as a diversification tool for someone whose wealth is 80% real estate, the psychology at least makes some sense.

This could actually provide some structural support for the ‘investment grade’ segment of the market, even as mid-tier pieces continue to struggle. The Morgan Stanley/WatchCharts reports have shown that Rolex supply has now declined for two consecutive quarters and is at its lowest level since January 2024. Meanwhile, secondary demand for mid-tier brands like Omega, Cartier, and IWC hit record highs, but then prices kept falling because supply also increased. The market is basically telling us that demand is concentrating into fewer, more liquid options.

US$9 Trillion Spousal Transfer

This is possibly the most overlooked finding in the entire UBS report. Everyone talks about the ‘Great Wealth Transfer’ to millennials, that’s the big 83 trillion number. But buried in the detail is something which feels (to me anyway!) much more significant for luxury brands in the near term; ~ 9 trillion will transfer horizontally between spouses over the next 20-25 years.

Women live longer than men, on average, so when a wealthy man dies, his wealth typically passes first to his spouse before eventually going to children. This means there’s a massive ‘interim market’ of widows and surviving spouses who will control significant capital before it moves to the next generation.

UBS surveyed 2,000 women investors in the US with at least USD 1 million in investable assets. They found 74% of women expecting an inheritance feel unprepared to manage it. About 43% haven’t seen their parents’ wills. A third have no idea where their parents’ accounts are located. And 40% inherited from parents without any wealth transfer or estate plan in place.

The watch industry, historically male-dominated in its collector base, has largely ignored this demographic shift - this is another thing I called out in SDC last year. Most brands’ idea of ‘targeting women’ has been to shrink their men’s watches and add some diamonds or other gems. The UBS data suggests, yet again, that brands are leaving serious money on the table.

Women who inherit significant wealth won’t necessarily be looking for ‘ladies watches’ either; they might be looking for assets with intrinsic craft value, legacy potential, and in an ideal world, emotional meaning. A well-executed and complicated mechanical watch in the 36-38mm range, marketed with respect rather than condescension, could actually resonate deeply with this emerging demographic.

Breitling has been pushing hard on their ‘Lady’ segment, with estimates suggesting around 14% of their sales now come from women’s sizes. Cartier, obviously, has always skewed more female because of their status as a jewellery maison. This suggests the mega-opportunity might be in high-complication pieces for women? I just don’t have the data to back up this assertion.

Regional Wealth Dynamics

The US hosts almost 24 million USD millionaires, roughly 40% of the global total. That’s more than China, France, UK, Germany, Canada, Japan, and Australia combined. This insane concentration has obvious implications for where brands should focus resources.

There’s a key nuance that often gets missed, which is that wealth growth in 2024 was heavily tilted towards North America due to a stable US dollar. Other regions saw declines in USD terms due to currency weakness. Since Swiss watches are priced in CHF and often pegged to USD for retail, they became significantly more expensive for millionaires in countries with weakening currencies (we all remember NYCWatchguy complaining about this on Instagram throughout the year!).

Turkey is another good example; nominal millionaire numbers grew 8.4%, but real average wealth contracted by 14.6% due to inflation. These are what the report calls ‘Inflationary Millionaires’ whose wealth grew, but only on paper. They’re not actually richer in purchasing power terms; they’re financially poorer.

Japan is another interesting case because the yen has been weak for years, which has attracted huge tourist spending (especially Chinese luxury shoppers looking for bargains). But local Japanese millionaires are actually losing ground in real wealth terms, and Japan lost 33,000 millionaires in 2024 (a decline of 1.2%).

For the watch market, this currency-driven arbitrage creates a bifurcation (of course it does) between primary and secondary channels. The primary retail market will be dominated by buyers in strong-currency regions (US, Switzerland, Middle East) and weaker-currency regions may see a boom in pre-owned watches, where prices can adjust more dynamically to local purchasing power.

We’ve covered the pre-owned market extensively on SDC, and this wealth report provides another explanation for why secondary demand remains strong even as retail sales decline. If you’re a Turkish or Brazilian collector, a two-year-old watch bought in local currency from a local dealer is far more ‘accessible’ than a new one priced in Swiss francs. I know, it sounds like I am stating the obvious here, so apologies if that’s the case!

The Great Bifurcation Continues

If you’ve been reading SDC for a while, none of this will surprise you. The K-shaped economy, where the wealthy get wealthier and everyone else struggles, is accelerating.

I previously wrote about this and mentioned examples like the McDonald’s CEO who talked about a ‘two-tier economy’ where upper-income consumers drive growth while lower and middle-income traffic ‘is down double digits’, Delta expects more revenue from premium offerings than economy cabins, and Coca-Cola sees highest demand for expensive products. This pattern is everywhere, and the UBS data confirms this at the macro level.

Nearly 60 million USD millionaires globally own around USD 226 trillion in assets. Meanwhile, the bottom half of the world’s adult population owns barely 1% of total global wealth. The Gini coefficient2 shows inequality has actually diminished marginally since 2000 globally, but within specific countries like the US, UK, and Thailand, it’s rising.

For watches, the implication is exactly what we’ve alluded to before, that the middle market is being systematically eliminated. You can position yourself in ultra-premium where wealthy buyers are price-insensitive, or you can position yourself in accessible value where lower priced watches thrive. What you cannot do is sit in the middle, charging too much to be a casual purchase but not enough to be truly exclusive.

This is why Rolex, Patek, and AP account for over 55% of Swiss watch industry value, (according to Oliver Müller from LuxeConsult) and why everyone else is getting hammered. The FHS November 2025 data showed that if the top five brands grew 3-5%, basic maths tells you the remaining brands must have declined around 8% on average.

Emerging Markets

The wealth report also offers a sobering look at which markets might actually deliver growth. China has basically reset to a lower baseline, and as we discussed last year, Oliver Müller doesn’t think it’s coming back to previous levels. The government has a dim view of conspicuous luxury consumption, there’s an ongoing real estate crisis, and trade complications with the US are only getting worse. Swiss exports to Greater China were down 23% in 2024 and continued declining into 2025.

India gets a lot of attention as ‘the next China’, but the numbers suggest patience is required. Yes, India’s wealthy entrepreneurial class is growing rapidly. Yes, 35 million potential luxury watch customers could emerge by 2047. But 2047 is a long way away, and current infrastructure, distribution, and cultural factors make India more of a mid-range opportunity than a high-horology one, at least for now.

The Middle East, particularly UAE and Saudi Arabia, offers more immediate potential. These are cash-rich markets with aggressive diversification strategies - but they’re also relatively small in absolute terms compared to the US or even Europe.

The reality is that the US will remain the primary engine for global Swiss watch exports for the foreseeable future. US buyers have higher immediate liquidity than their global peers, and when American equity markets perform well, watch boutiques feel it almost immediately. That’s why brands are prioritising US distribution channels, and why the tariff situation has been such a massive ballache for the industry.

So What?

Now that you’ve read all these words about macro economics and wealth, you may be asking what it means for you personally… I guess it depends on who you are, your age, and where you’re based!

If you’re in a strong-currency country, particularly the US, you’re in a pretty favourable position for new watch purchases. Retail prices have absorbed tariffs and currency moves to varying degrees, but your purchasing power relative to global peers has improved. The flip side is that if you’re planning to sell internationally, your watches command a premium that may disappear if the dollar weakens.

If you’re in a weak-currency country, the pre-owned market is your friend. Secondary prices adjust more dynamically to local purchasing power, and you’re not paying the full CHF/USD premium embedded in new retail. This is actually a smart time to build a collection through pre-owned channels and to avoid boutiques.

If you’re an EMILLI with most of your wealth in property, consider whether your watch collection serves as portfolio diversification. I’m not suggesting you should view watches as investments, but there’s something to be said for having portable, liquid assets when your wealth is otherwise locked in real estate. Just be realistic about value retention and don’t chase hype for the heck of it.

If you’re thinking about succession, the wealth transfer data should prompt some deep reflection! Women will increasingly control significant capital over the next 20 years. If you’re building a collection partly with legacy in mind, consider whether the pieces you’re buying will resonate with the people who’ll inherit them. A watch that tells a story might be worth more to your daughter than one that’s just… expensive.

What else?

Perhaps the confirmation bias is clear now? If not, my conclusion is that the UBS Global Wealth Report essentially confirms what we’ve been discussing on SDC for many months - we’re living through a restructuring of who has money, how that money is held, and what those people want to buy. If you disagree, I’m all ears!

The watch industry’s traditional playbook assumed a continuously expanding global middle class with disposable income for aspirational luxury purchases. That assumption is breaking down. What’s replacing it is a more polarised world where ultra-wealthy buyers remain price-insensitive while everyone else faces liquidity constraints and currency problems.

The brands which have high hopes of growth need to wrap their heads around this new reality. Rolex gets it, which is why they’re doubling down on US distribution and building out their Certified Pre-Owned programme to capture value across the market cycle. Patek gets it, which is why they’ve targeted their core ultra-wealthy base more than anyone else. The independents get it, which is why Journe, Rexhepi, and others with locked order books are essentially recession-proof.

The struggling brands are those trapped in the middle; they are too expensive to be impulse purchases, but not exclusive enough to command ‘wealth-preservation’ premiums.

For you as collectors, the opportunity here is in being a contrarian. When everyone is chasing the same five brands, the mid-market probably offers supreme value for people who care about horology instead of resale value. A beautifully made JLC at 40% off is a watch, not an investment, and that might be exactly the right mindset in these strange times.

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