Henry is here referring to the Biblical magi—the three wise men who brought gifts to the baby Jesus in the manger. He says that because the wise men were wise, their gifts were accordingly wise gifts. They were gifts that had physical value and would be viewed as valuable by anyone; they could be exchanged or sold if two identical gifts were received, for example. This constitutes a wise gift.

Henry contrasts the magi with Della and Jim, whose gifts were not wise. They sell the most valuable things they own to buy gifts for each other, and ironically neither is then able to use the gift received. However, Henry concludes that these two are in their own way "the most wise." We can infer from this that Henry is suggesting their gifts were more than the sum of their parts. Each demonstrated to the other the depths of their love by selling something that was very valuable and dear to them, in order to have something special to give to their partner. As such, what they have really exchanged is proof of their love for each other, which is a wise gift after all.