My daughter is fortunate because I gave her some of my mother's jewelry from the 1920s and 1930s, the Art Deco period. This has been and probably will continue to be a sought-after commodity. Francois Curiel of Christies auction house said that jewelry from this period is valuable, more so than jewelry from the 1950s and 1960s, for example. So now my daughter has taken an interest in investing in jewelry. I told her that it is not easy to make a profit, but once she knows something about it, she will have a better shot.
We live in an area of the South where there are many antique stores, so I suggested she poke around in some of them. The inventory for antique jewelry is fixed, and many consumers want a unique piece that stands out. I told her to look through antique stores for a piece that she would enjoy wearing. That way, if she doesn't intend to sell the jewelry for profit, she will at least own a piece she enjoys. I would not like to see her simply stashing the jewelry into a safe deposit box. If my daughter enjoys the piece, it probably was designed well enough to have stood the test of time. Although my daughter might not get an honest answer, I told her that she should always ask whether the stone is original.
Investing in diamonds, I told my daughter, requires buying top-quality stones that have a Gemological Institute of America or an EGL USA certificate. Many quality diamonds for sale already have the GIA or EGL certificate with them. If not, she would need to insist on getting one before she buys. No one should ever take the seller's word that the diamond has one. Because we have always owned dogs, I used an analogy she could relate to: Both certificates act the same as a pedigree paper does for a purebred dog. They guarantee that a third party has authenticated the piece.
Choosing a Diamond
Regarding diamonds, I told my daughter that if she wants to sell diamond jewelry, it might take some time to do so. Typically, the rarer and more expensive the diamond, the easier it is to sell. Diamonds require lots of money to invest in. If she were to buy white diamonds as a long-term investment, for example, she would probably need to go big, such as more than five carats. Another method would be to buy naturally colored diamonds that are pink, yellow, green, blue, purple or red. These diamonds have retained their price since the 1970s. As a point of reference, I reminded her the Hope Diamond is blue. People who sell diamonds use the Rapaport Diamond Report to price the diamonds. She can only expect to make a profit if she finds the price and buys diamonds from a retail store that has a markup of only 5 percent to 10 percent over cost.
I steered her away from investing in gold jewelry because it would be difficult to make a profit. The problem with using gold jewelry as an investment is that people buy gold bullions or coins as investments. That drives up the price of gold, and the price of gold jewelry rises, making it a bad investment. Even when demand for gold jewelry is up in India and China, those markets are volatile.
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