Fine jewelry is one of the most prudent investments you can make today. Unlike squandering money by investing in perishables like designer jeans, an investment in fine jewelry and gems lasts throughout the generations. They can then be passed on and become heirlooms or sold at a premium.
Fine jewelry and gems have an intrinsic value that withstands the test of time. Unlike stocks, which can lose value when competitors come along and make the company obsolete, fine jewelry and stones provide security in that their value consistently increases at inflation rate.
Popular gemstones will, more often than not, resell at a profit later on with online auctions, jewelry stores and auction houses all potential buyers.
Some of the things to consider when investing in jewelry include:
- Controlling your cost basis
In order to make money from fine jewelry and gemstones, your cost basis in that particular gem should give a profit the day you acquire it. For your investment to give you the margin of safety needed, it is important that you pay the right price.
This calls for adequate knowledge in the jewelry and gemstones market and also requires that you exercise a great deal of caution while on it. To generate a good return on your investment, one should seek out wholesale prices or get your gemstones from a primary dealer. A primary dealer mines and cuts the stones himself.
The internet is a great place to source for both primary dealers and wholesale dealers.
- Consider whether you can add value to the gem
When investing in precious stones, it is important to consider whether you can add value to the stone either by re-cutting or re-polishing.
Two areas that gems take a substantial increase in price include:
- Between loose gems and jewelry
- Between rough and cut gemstones
Finished jewelry has the added advantage of a greater market appeal than loose gems. Setting the stones to create the jewelry, however, requires great skill and finesse which you may not have. It is important therefore that when you buy the rough, it is at a price that justifies the labour and expenses involved in making it into fine jewelry.
Custom faceted gemstones also give more return on investment than commercial cut gemstones because they are cut to perfection, are all unique and are cut purposely to bring out the stone’s beauty.
- Quality and Legitimacy
When in the market for fine jewelry it is important to compare quality, and service from various sellers. It makes it easier when you have recommendations from knowledgeable people.
Jewelry certifications are also very important as they helps ascertain the value of the gem. According to experts on certification, different gems of similar appearance could have a very big disparity in value. It is therefore important that the gem be certified by a company of reputable standing.
Unlike fashion jewelry, investing in fine jewelry takes commitment, it requires patience and wisdom. For example it is important to insure the jewelry. It is also important to invest in handy pieces that will retain their glory throughout the years.