The Top 10 Jewelry Investments for 2020 January 27, 2020 – Posted in: Jewelry Blog
Over the last ten years, jewelry assets outperformed the US equities, New York real estate, and gold. And in 2017 the demand for diamonds reached an all-time high.
However, the peak was short-lived and global jewelry sales dropped in 2018. This shows the volatility of the market indeed, but it shouldn’t deter you from investing.
Experts believe that sluggish sales were due to the slower economic growth on a global level. On the other hand, investing in jewelry isn’t the same as investing in other assets.
To explain, it’s more like investing in fine art than investing in real estate, for example. And if you’re in it for the long-haul, there is money to be made.
- Natural Saltwater Pearls
- Colored & Fancy Diamonds
- Rare Vintage Rings
- Signed Jewelry
- Kashmir Sapphires
- Unheated Burma Rubies
- Gold and Platinum
- Type II Diamonds
- Red Spinel
- Colombian Emeralds
Skip to the bottom to read the tips for investing in jewelry.
Jewelry That’s Predicted to Perform – The Ultimate List
Despite the movement in the markets, certain pieces of jewelry seem to have a promising future. The following article features the types of jewelry that should be on your radar in 2020. So read on to find out more about the dos and don’ts of jewelry investments.
Natural Saltwater Pearls
For those in the know, there’s no contest here. The best investment option is natural saltwater pearls. That is to say, the jewelry made with natural saltwater pearls.
Most of their value comes from the fact that these are very hard to find. In fact, the majority of natural saltwater pearls are more than one hundred years old. And they usually feature on antique jewelry.
Consequently, the price of these pieces can go sky high and keep growing with the coming years. To put things in perspective, just 1 in 10,000 oysters yield a natural pearl good enough for jewelry.
What’s more, pearl diving is a dangerous craft that died out. Facts you need to account for if you’re to invest in pearls. Ideally, you should opt for an antique natural saltwater pearl necklace, earrings, or bracelet.
But what about the natural freshwater pearls?
These are a great bar of entry if you aren’t in a position to invest in saltwater pearls. They’re much more expensive than their cultured counterparts, both saltwater, and freshwater.
However, natural saltwater pearl jewelry is more common, albeit some consider the pearls themselves rare. Due to this, you should aim for a piece that offers more than just the pearls.
For example, it’s best if the necklace or bracelet contains some gemstones or it comes from a famous designer.
To learn more about investing in Natural Saltwater Pearls, click here.
Colored & Fancy Diamonds
The D grading signals that the diamond is colorless “white,” and Z diamonds have a yellowish tint. The diamond’s value drops the more they appear to show color. But there is a catch.
The so-called fancy diamonds are colored and not graded on this scale. These are exceptionally rare and the ratio is similar to the natural saltwater pearls.
GIA indicates that 1 in 10,000 diamonds has a desirable color. And the colors that attract the most attention are blue, red, pink, and green.
As a result, fancy diamonds have become one of the best jewelry investments. What’s more, these eye-catching assets have had stable growth over the past decade. But it’s not only about their rarity.
There is a spike in demand in the Asian markets and this trend drives the prices up.
For example, the famous CTF Pink Star has become the most expensive gemstone in the world in 2017. This mesmerizing pink diamond was sold in a Hong Kong auction for $71.2m.
However, you’re probably looking to add a more down-to-earth asset to your portfolio. Therefore, you should aim for a gem that’s as close to D as possible.
Rare Vintage Rings
Right off the bat, you won’t go wrong with period pieces. Rare vintage rings, as well as other types of vintage jewelry, are in high demand. At the same time, they fall into the most valuable category and the prices are growing.
“This is Money”, one of the UK’s top financial websites, draws from an Art Market Research report to reveal how much the market has gone up. As per the research, the prices of vintage jewelry have gone up 80% over the last 10 years.
But what are the things you should know when investing in a rare vintage ring?
First, Art Deco jewelry seems to outperform other pieces. The style comes from France and appeared prior to the Great War. It prospered into the 1930s but was at its zenith between 1920 and 1930.
The pieces that fall into the golden years of Art Deco tend to be the most valuable. But you need to take this with a pinch of salt. Characteristics other than the era may drive the price up or down.
Assuming you’d like to invest in a rare diamond vintage ring, you need to pay close attention to the 4 Cs. Let’s take the Bayside ring from the Estate Diamond Jewelry collection as an example.
This exquisite piece sports a 4.83-carat diamond which has been GIA-certified as of VS2 clarity and K color. The ring was handcrafted in 1925 and fetched a $75,000 price at the time of writing.
However, the pieces from the same period start at about $4,000. So there is room for novice investors who don’t have a small fortune to spend on a vintage ring.
Click here to view our entire collection of vintage rings.
Signatures such as Bvlgari, VCA, and Cartier are enough to add thousands of dollars, if not hundreds of thousands, to the value. But it would be wrong to assume that it’s only about the name.
The two main things that add value to the signed jewelry are their scarcity and outstanding craftsmanship. Renowned designers go above and beyond to create pieces that transcend generations and set trends.
To give you a better idea of how this works, it’s best to use VCA Alhambra necklaces as an example. About ten years ago, VCA crafted one hundred of these necklaces and each one has a number. Fast forward to today, and their clover style has become highly sought after.
If you were lucky enough to get your hands on an Alhambra when it got released, you could more than double your money today. Initially, the necklace was about $6,000 and in 2017 you could easily sell it for $12,000 or more.
Aside from necklaces and bracelets, signed engagement rings are among the top assets to invest in. What’s more, the bar of entry isn’t that high and you can get a Cartier diamond ring for under $10,000.
Some consider sapphires to be second to diamonds and this is true in many respects. However, it doesn’t make sapphires a subpar investment, quite the contrary.
Sapphires range in color from blue to orange. And the finest blue ones come from the Kashmir region in the Indian subcontinent. But this isn’t the end of the story.
If you aim for the cream of the crop, padparadscha sapphires should be part of your collection. These are the rarest and may fetch astronomical prices in the future.
That being said, it might seem unreasonable to pay the premium now given the volatility of the market. But as with other gemstones, it’s all about the long-haul.
About fifty years ago, you’d pay $1000 per carat for blue sapphire. However, the prices now fetch a whopping $200,000 or more per carat.
In addition, sapphires are a popular option for engagement rings and this trend is likely to continue. Therefore, you shouldn’t wait for long before you resell your Kashmir gem, even if it’s loose.
However, there’s one thing you should know, Kashmir sapphire jewelry flies off the shelves. So don’t hesitate to snatch one when you get the chance.
Click here to contact us to learn more about our private collection of Kashmir Sapphires
Unheated Burma Rubies
Similar to blue sapphires, unheated Burmese rubies are one of the most stable investments. Many collectors report that they hold value much better compared to diamonds. And of course, the rarer the ruby the higher the price.
The most valuable ones are a vivid red, the color of which dealers dubbed pigeon’s blood. Regardless of the sinister name, color is the key factor when shopping for rubies.
These gemstones usually have inclusions. Therefore, you can get away with less clarity as long as the color fits the bill. Plus, this is one of the reasons you should always get a ruby with a GIA or other certificate.
So far so good, but what about the prices?
Christie’s has set the record carat rate for Burmese rubies in 2006 – more than $420,000. But it’s best to take a step back from the enchanting extremes.
In the last ten years, the prices for classic rubies have gone from about $2,600 per carat to $44,000. Despite the potential fluctuations, this signals the rising trend for exotic gemstones.
Gold and Platinum
Gold and platinum are both commodities and jewelry. You’re looking for a jewelry investment, but it doesn’t hurt to take a look at the commodities market.
At the onset of the new millennia, the price of gold was quite low – a bit more than $320 per ounce. In 2011, it had reached an all-time high at $1,802 per ounce. Although there have been some ups and downs, the prices are now stable and relatively high.
However, platinum is much more volatile and currently follows bearish trends. With this in mind, this precious metal is prone to extreme spikes. Therefore, now might be the time to invest in this commodity or, at least, hold your position.
The main question is if these fluctuations affect the jewelry market.
Of course, they do, but the price of precious metal isn’t the only factor that dictates the value of the jewelry. And there are certain pointers that indicate platinum jewelry might be better than gold.
Take Art Deco pieces as an example. One of the signature features of this era is a combination of platinum and diamonds. And more importantly, sales show that this style has stood the test of time.
Type II Diamonds
Aside from colorless and fancy color diamonds, those that have a Type II rating are likely to make you a profit. The reason for this is their rarity and purity.
About 2% of the world’s diamonds fall into this category and they are the most chemically pure. To be exact, they contain no or very little nitrogen, making them superior to other types. What’s more, it’s not uncommon for these gems to come with an interesting provenance.
Combine that with rarity and purity and you get the perfect investment opportunity. But there are some things you should know about Type II diamonds. They’re usually bigger than 1.0 carat which makes them even more expensive.
In addition, their estimated value is between 2% and 3% higher than other diamonds. Plus, GIA issues a separate certificate that attests to their exceptional purity. But what about the actual price?
For example, a diamond that weighs 5.50 carats and is of color D and IF clarity costs about $800,000. Add a Type II specification to that and you’ll be paying $25,000 more.
This puts the price of such a diamond at about $150,000 per carat. But then, when you factor in the cut and the maker’s mark, the valuation is likely to spike further.
Red spinels have turned out to be an investor’s dream. Just a few years ago, nobody seemed to invest in spinels, red or any other color.
If you look back further in the past, red spinels were selling for a meager $200 per carat in 1970. Since that time, prices have slowly but steadily increased, but the real boom happened in the last five years.
Depending on where a spinel comes from, it may fetch up to $50,000 per carat. This astronomical figure applies to red spinels that come from Tanzania. And these stand out due to their top investment potential.
However, spinels are not out of reach for jewelry investors on a budget. There are really good pieces that go for about $5,500 per carat and spinels are becoming harder to find. But the important thing is how these gems become so popular.
The reason for the spike in demand stems from designer candy-colored collections. As these become the must-have jewelry for celebrities and the likes, the spinel’s price rocketed.
This teaches you a valuable lesson about jewelry investments – trends have the power to dictate the prices. And if you factor the gem’s rarity and features, you should be able to guestimate the next winner.
Despite some controversy due to the use of chemical treatment, natural untreated emeralds are still a good investment. Their prices start at about $500 for a 0.5-carat SI clarity emerald and go up to $8,000 for a VVS gem of the same weight.
This allows smaller investors to get in on the game, but there are a few things you should know before purchasing an emerald. Bigger stones sell better and they can be much more valuable than smaller pieces.
For example, one 3-carat Colombian emerald can be 6 times more expensive than three 1-carat stones of the same quality and provenance. Speaking of which, Colombian emeralds are the most valuable, followed by stones from Brazil and Zambia.
In addition to size, color is the key factor that adds to the price. Tiny discrepancies in hue and saturation can add thousands to the price per carat. The color you should aim for is bluish-green with vivid saturation, and a faint dark tone.
In fact, it’s okay to sacrifice a carat or two in order to get an emerald of a better color. And if it comes in a vintage or antique piece, you shouldn’t think twice about the investment.
Tips for Jewelry Investing
Regardless of the asset or component, your money isn’t 100% safe. This, of course, refers to the risk of losing returns or depreciation in the value. However, there are ways to mitigate risk and keep your returns high. Here are the steps you need to take.
Do Your Homework
Novice investors often believe that investing in precious metals and diamonds is risk-free in itself. But you now know that this isn’t the case. You might end up paying a premium for a piece that just won’t hold its value, let alone earn you money.
To avoid this, you should follow some basic guidelines. Diamonds that weigh more than 1 carat have a higher resale value and classic cuts trump trends. If you’re in for gold, don’t suffice for anything below 14 karats.
As indicated, vintage pieces outperform contemporary jewelry, but certain signature pieces are the exception to the rule. And each piece needs to come with documentation and certificates. Otherwise, its value is bound to depreciate as time goes by.
Use Patience and Time
Yes, it’s easy to get emotionally involved and lose sight of the key features to look for. Jewelry is beautiful and a lot of pieces have a cool story that might drive up the price.
The rule is, you should never make an impulse purchase unless the piece checks out 100%. This means it’s vintage or antique, comes from a reputable dealer, and has a ton of paperwork.
Unless it ticks the right boxes, it’s best to step back and do due diligence to ensure you’re making the right decision.
The urge to flaunt your jewelry collection is hard to resist, but you should bite your lip and keep it a secret. If not, there is a strong chance you might end up like Kim Kardashian. Remember the Paris jewelry heist?
Anyway, this article has pointed out that jewelry investments are long-term. You’re waiting for the right time to sell and it might be years or even decades down the line. Until then, enjoy your collection on your own and keep it a secret.
And when you agree to resell an item, you need to be extra vigilant. Make sure to conduct the due diligence for the buyer and find a safe transaction route.
It’s not uncommon for top jewelry collectors to hire security when handling their collection. This is something you should consider if your jewelry portfolio exceeds six figures.
Most insurance companies will be more than happy to offer you a policy against theft and damage. But things are a bit different when you want to protect your collection as an investment.
You might need to shop around a little before you find insurance to cover your jewelry portfolio. Plus, you need to figure out if future profits justify the price of the insurance.
Be that as it may, you’ll do just fine with theft and damage coverage. And you may lease a safety deposit box for further protection when your collection grows big enough.
Click here to learn more about jewelry insurance.
Find an Expert Jeweler
It’s safe to say that your jeweler is the key to mitigating risk. When your money and passion is in the right hands, it’s possible to make a significant chunk of change. But what makes a jeweler trustworthy?
Although there are no exact rules, certain factors make the jeweler outstanding.
Good Reviews. A trustworthy jeweler should a clean online record. Type their name and do research. See what their previous customers have to say. Watch for mentions or shoutouts in high-profile websites. A genuine jeweler will have a solid reputation.
Transparency. A reputable jeweler doesn’t try to force you to buy based on emotion or personal guarantees. But rather, he or she presents you with the hard evidence regarding a ring, necklace, or loose stone. And all this is supported by documents, certificates, and market data.
Services. A trustworthy jeweler offers a host of auxiliary services. The company usually provides yearly upkeep free of charge or with a minimal fee. If need be, the jeweler can offer secure shipping for your items and basic insurance.
But the biggest perk is that a trustworthy jeweler builds a long-standing relationship with you. The company becomes the go-to place whenever you want to invest, without thinking too much about it.
If you would like to develop a relationship with us (Estate Diamond Jewelry), please feel free to create an appointment to visit our New York Showroom. You can meet us and decide if we are the right fit for your jewelry investment needs. Alternatively, you can give us a phone call at (212) 265 3868.
When all is said and done, jewelry investing is complex because there are more than a few parameters that affect the value. But it’s possible to make substantial profits as long as you know what you’re doing.
And don’t forget, you’re not in it alone. Your jeweler is there to offer guidance, support, and insider tips to boost your portfolio.