- Jane Birkin died in Paris on Sunday at age 76.
- She inspired Hermès’ iconic handbag after a chance conversation with a company executive in 1980.
- The bag is the ultimate status symbol — and a great investment.
My first recollection of reading about an Hermès Birkin bag was not in the glossy pages of a fashion magazine but in a weekend edition of a business daily newspaper.
Over our customary second cup of tea, my mother, a financial advisor, and I, a budding accountant, pored over a report that said a Birkin bag was one of the best investments out there — even outperforming traditional asset classes such as gold and stocks.
My mother scoffed at the idea. Growing up in Mumbai, we didn’t see many Birkins in person. This was a bag for the glossies — not an item to be listed in a wealth portfolio.
And while my career as a business reporter has had me reporting on stories about luxury items as investments, I was jolted back to this particular conversation after reading Jane Birkin’s obituary over the weekend.
Because, for me, the Birkin bag — which retails for anywhere from $10,000 to $250,000 for the more high-end designs — primarily represents a store of value.
Take, for example, a Credit Suisse and Deloitte joint study published in October 2020. The report’s authors found that the value of Hermès’ Birkin bags increased by 38% on average that year, way eclipsing the returns given by the Dow and the S&P 500. The latter rose about 16.3% in 2020, per the report.
An earlier study tested the hypothesis over a four-decade timeframe.
While comparing the increase in value of an Hermès handbag to that of gold and the S&P 500, a January 2016 study by Baghunter found the Birkin’s value rose by about 14.2% on average between 1980 and 2015. The value of gold rose by about 2% on average over the 35 years. Meanwhile, the S&P 500 returned an increase of about 9% on average, per the report.
While the idea that an investment portfolio should contain diversified assets such as luxury items is not new, but the philosophy seems to be gaining traction.
And I, for one, can’t stop from marveling that all this was spurred from a chance conversation between Jane Birkin and an Hermès executive back in 1980.
The singer and actor who inspired Hermès’ signature bag died on Sunday at age 76.
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