For the average investor, investing in jewelry will often not result in a profit. However, many want to explore this avenue, especially when considering a significant jewelry purchase. Jewelry often has a 50-100% markup, while bullion premiums are usually far less than that.
But people buy jewelry for different reasons compared to when they buy bullion. But is jewelry a good investment?
Jewelry vs Bullion Overview
When comparing jewelry and bullion as investment options, several key distinctions emerge. Jewelry’s value is often influenced by ever-changing fashion trends, potentially resulting in depreciation over time. Bullion historically maintains its value, which is directly correlated with precious metal prices, making it a stable investment choice.
| Jewelry | Bullion | |
| Value Retention | Subject to fashion trends | Historically maintains value |
| Liquidity | Less liquid | Highly liquid |
| Portability and Storage | Requires care | Depends on the quantity |
| Premiums | High | Fair |
| Maintenance | Requires maintenance | No maintenance |
| Diversification | Rarely contributes | Good option |
| Taxes | Sales and capital gains taxes | May be exempt from sales tax |
Value Retention
Bullion, typically in the form of coins or bars, maintains its value based on its intrinsic precious metal content. This tends to track closely with the metal’s market price, providing a relatively stable store of value over time.
Jewelry, on the other hand, incorporates craftsmanship, design, and sometimes gemstones in addition to the intrinsic value of the metal. While high-quality jewelry pieces can retain or appreciate due to these factors, they may not track as closely with the market price of the metal alone.
In times of economic uncertainty or high inflation, bullion often outperforms jewelry regarding value retention due to its direct link to the metal’s market price. However, during stable economic periods, well-crafted and sought-after jewelry pieces can also hold or increase in value.
Liquidity
Bullion, such as gold or silver coins and bars, typically enjoys high liquidity due to its standardized purity and weight, making it easy to buy and sell in the precious metals market. Bullion dealers and exchanges readily trade these items, providing quick access to liquidity.
Jewelry, however, may have lower liquidity compared to bullion. The value of jewelry is influenced by intrinsic metal content and factors such as design, craftsmanship, and gemstone quality, which can vary widely. This variability can make it more challenging to assess and negotiate the value of jewelry pieces accurately, potentially leading to longer selling times and lower resale values compared to bullion.
Portability and Storage
Bullion, typically in the form of coins or bars, is compact and easy to transport due to its high value-to-weight ratio. Small denominations of coins or bars can be easily stored in a safe or vault.
Jewelry may vary in size and weight depending on the design and materials used. While individual pieces may be lightweight and portable, collections or larger pieces can become cumbersome to transport.
Jewelry and bullion require secure measures to protect against theft, damage, or loss. Bullion can be stored in specialized safes, vaults, or secure storage facilities designed to accommodate precious metals. Jewelry may also be stored in safes or vaults, with additional considerations for protecting delicate designs and gemstones.
Premiums
Bullion premiums represent the additional cost above the metal’s spot price that buyers pay for items such as coins or bars. These premiums cover production costs, dealer markups, and other expenses associated with acquiring and selling physical precious metals. Premiums can vary depending on factors such as the type of bullion, its condition, and market demand.
For jewelry, premiums are also present but are often more subjective and variable. The premium for jewelry encompasses factors such as design, craftsmanship, brand reputation, and the value of any gemstones incorporated into the piece. High-quality, well-crafted jewelry pieces from reputable brands or designers may command higher premiums due to their perceived value and desirability.
Maintenance
Bullion, typically in the form of coins or bars, generally requires minimal maintenance. As they are primarily inert objects made of precious metals, bullion rarely tarnishes or degrades over time. Proper storage in a dry and secure environment is usually sufficient to maintain its condition.
Jewelry requires more maintenance due to its intricate designs, gemstones, and varied materials. Precious metal jewelry can tarnish over time, especially if exposed to moisture or chemicals. Also, gemstones may require cleaning and periodic inspection to remain securely set. Certain types of jewelry, such as pieces with intricate designs or delicate components, may also require professional maintenance or repairs over time.
Diversification
Bullion, such as gold or silver coins and bars, provides direct exposure to the precious metals market. Including bullion in a portfolio can help hedge against inflation, currency devaluation, and economic uncertainty. Additionally, bullion prices often move independently of traditional financial assets like stocks and bonds, making it an effective diversification tool.
Jewelry, while also containing precious metals, offers diversification in a different form. Unlike bullion, the value of jewelry is influenced not only by the intrinsic metal content but also by factors such as design, craftsmanship, and gemstone quality. Including high-quality jewelry pieces in a portfolio may provide exposure to the luxury goods market and add aesthetic diversity to an investment strategy.
Taxes
Taxes on jewelry and bullion can vary depending on several factors, including the jurisdiction, the method of acquisition, and the holding period.
- Capital Gains Tax: When sold for a profit, jewelry and bullion may be subject to capital gains tax. The rate and exemptions vary by country and can depend on factors such as the length of time the asset was held.
- Sales Tax: Some jurisdictions impose sales tax on the purchase of jewelry and bullion. However, exemptions or lower rates may apply to bullion purchases, especially if the metal is considered investment-grade.
- Inheritance Tax: Depending on the laws of the jurisdiction, inheritance tax may apply to jewelry and bullion passed down to heirs.
- Wealth Tax: In some countries, individuals may be subject to wealth taxes based on the total value of their assets, including jewelry and bullion holdings.
- Value Added Tax (VAT): In some regions, VAT may apply to the purchase of jewelry, whereas investment-grade bullion is sometimes exempt from VAT.
Jewelry that may Hold and Gain Value
While the value of jewelry can be influenced by various factors such as fashion trends, craftsmanship, and materials used, certain types of jewelry have demonstrated a tendency to hold or increase in value over time.
While most jewelry does not appreciate, there are a few exceptions, such as,
Diamond Jewelry
High-quality diamonds with excellent cut, clarity, color, and carat weight often retain value. Diamonds are durable and timeless, making diamond jewelry such as engagement rings, stud earrings, and tennis bracelets desirable pieces that tend to hold their value.
Fine Watches
Luxury watches from reputable brands like Rolex, Patek Philippe, and Audemars Piguet are known for their craftsmanship, precision, and exclusivity. Limited production, high demand, and enduring appeal contribute to their value retention and potential for appreciation over time.
Antique and Vintage Jewelry
Pieces with historical significance, unique designs, or craftsmanship from renowned artisans can appreciate, especially if they are rare or collectible. Antique and vintage jewelry often carry stories and cultural significance, making them sought-after by collectors and enthusiasts.
Designer Jewelry
Signature pieces from renowned jewelry designers like Cartier, Tiffany & Co., and Van Cleef & Arpels are highly coveted for their craftsmanship, brand reputation, and iconic designs. Limited edition or discontinued pieces from these designers can appreciate in value due to their exclusivity and prestige.
Fine Gemstone Jewelry
Gemstones such as sapphires, rubies, and emeralds of exceptional quality and size can command high prices in the market. Fine gemstone jewelry featuring high-grade gemstones with vibrant color, clarity, and rarity often holds its value well over time.
Gold and Platinum Jewelry
While the value of gold and platinum jewelry may fluctuate with precious metal prices, pieces made with high-karat gold (e.g., 18K or 24K) or platinum tend to retain value due to their intrinsic worth. Timeless designs and classic styles further enhance their appeal and value retention.
Investment-Grade Pieces
Some jewelry pieces are specifically marketed as investment-grade due to their exceptional quality, rarity, or historical significance. These pieces are carefully curated for their potential to appreciate in value over time and are often sought after by serious collectors and investors.
Reasons People Buy Precious Metals Jewelry
There are many reasons why people buy jewelry, including sentimental reasons, fashion and self-expression, gifts, or celebrations. When investors purchase bullion, they are often motivated by the intrinsic value of the precious metal over the item’s appearance.
The most common reasons people buy precious metals jewelry include,
Marriage
For the average person this is one of the most common reasons to purchase fine jewelry. However, many opt for alternatives like tungsten, silicone, or synthetic diamonds. Plus, most do not purchase wedding rings with the notion of selling them.
Gift Giving
Jewelry is often given as gifts to commemorate a special occasion like a graduation, holiday, anniversary, or birthday. They are also given as an apology and commitment to the future. Some buy jewelry early in a relationship to express their future intentions.
To Express Culture and Personal Identity
In many cultures, wearing precious metal jewelry symbolizes status, tradition, or milestone celebrations. Some wear jewelry to celebrate their birthstone or zodiac sign. Some wear jewelry to express their personality or status.
Fashion and Style
Jewelry crafted from precious metals is prized for its aesthetic appeal, craftsmanship, and symbolic significance. Many like to wear curated items to important events or celebrations.
Inheritance and Legacy
Some purchase jewelry to pass down precious metals jewelry as heirlooms, carrying sentimental value and historical significance across generations.
Fashion Jewelry vs Fine Jewelry
Fashion jewelry is typically made from non-precious metals such as brass, stainless steel, or alloy, often plated with gold, silver, or other metals. It may incorporate synthetic gemstones or crystals. Fine jewelry is crafted from precious metals like gold, silver, or platinum, and often adorned with genuine gemstones such as diamonds, sapphires, rubies, or emeralds. However, even fine jewelry is often alloyed and is not as pure as most bars and coins.
Sadly, when many inherit their relative’s jewelry box, it may contain fashion jewelry. If you inherit items that you think may be valuable, you should have them appraised.
Gemstones vs Precious Metals
Metals like gold, silver, and platinum are valued for their rarity, durability, and malleability. They are the structural foundation of jewelry pieces, providing strength and stability. Gemstones encompass a variety of minerals prized for their beauty, rarity, and color. They include diamonds, rubies, sapphires, emeralds, and others, each with distinct physical properties and aesthetic qualities.
In some cases, when you seek an appraisal, the metal and the gemstone may be considered separately, especially if the item is not well crafted, is a not designer item, or an unpopular setting.
How Much Can I Make if I Sell to a Jeweler or Pawn Shop?
The amount you can make by selling jewelry to a jeweler or pawn shop depends on numerous factors, including the quality, condition, and market demand for the jewelry (or metal) and the negotiation skills of both parties involved. Depending on these factors, you can expect to receive a percentage of the jewelry’s estimated value, which may range from around 20-60% of its retail price.
Jewelers often offer higher prices for high-quality, desirable pieces that they can resell to their customers for a profit. Pawn shops may offer lower prices but provide quick cash for items they can resell or use as collateral for loans. You may only receive a higher offer if it is a designer or rare item that they can quickly sell.
It is important to know that some may only pay you less than the price of melt value so they can realize a small profit when they sell the items for melting value.
To better understand how much you can make, consider getting multiple quotes from different jewelers or pawn shops and comparing their offers. Additionally, it’s essential to have realistic expectations about the value of your jewelry based on its characteristics and current market conditions.
Wearable Bullion
Wearable bullion bridges the gap between jewelry and bullion. With our bezels, you can wear your bullion. They are available in sturdy 14K or sterling silver, and some even include diamonds. They are designed to hold bullion coins or small bars. This is a way to wear your bullion like jewelry and bullion rarely loses value like traditional jewelry.
We also offer gold and silver watches. Many include bullion elements. We have watches featuring the Gold American Eagle, Gilded Mercury Dime, Walking Liberty, Morgan Dollar, and more. These watches make elegant gifts and display your enthusiasm for bullion coins.
Bullion as Beautiful as Jewelry
If you desire attractive pieces, consider high-quality bullion items that are well-designed and produced by reputable mints. Coins, rounds, or bars are not always simple bullion items; some are incredibly beautiful, and most gold items hold their value.
When it comes to bullion items celebrated for their exquisite design and beauty, several options stand out:
American Silver Eagle
Renowned for its elegant depiction of Lady Liberty on the obverse and the iconic heraldic eagle on the reverse, the American Silver Eagle is highly sought after by collectors and investors alike.
Canadian Maple Leaf Series
The Canadian Maple Leaf bullion coins, particularly the silver and gold versions, are cherished for their intricate maple leaf design, symbolizing Canada’s natural beauty and purity.
Austrian Philharmonic
These coins blend musical heritage with artistic brilliance, featuring the Vienna Philharmonic Orchestra’s instruments on one side and the Great Organ of the Golden Hall in Vienna’s Musikverein on the other.
Perth Mint Lunar Series
The Perth Mint’s Lunar Series showcases the Chinese zodiac animals with stunning detail and craftsmanship, making each release a masterpiece of numismatic art.
PAMP Suisse Fortuna Bars
PAMP Suisse is renowned for its ingenuity in bullion design, and the Fortuna Bars are no exception. They feature the Roman goddess of fortune, Fortuna, in various artistic renditions, adding a touch of elegance to your precious metal investment.
British Britannia
The Britannia coins depict the iconic figure of Britannia, symbolizing Britain’s strength and tradition, while the design evolves subtly each year, adding collectibility to its intrinsic beauty.
These items are some of the most popular bullion items worldwide. They are highly liquid and easy to sell. These bullion items offer a secure investment and embody the artistic excellence and cultural significance that make them prized additions to any collection.
Artistically Designed Bullion Items
These bullion coins are known for their artistry and craftsmanship. They include bullion coins like the Libertad or Pandas, intricate high-relief coins, and collectibles.
- Mexican Libertad: The Libertad coins boast stunning depictions of Winged Victory on the obverse and the Mexican National Coat of Arms on the reverse, symbolizing Mexico’s fight for independence and its rich history.
- U.S. Mint High Relief Coins: High-relief coins are unique numismatic pieces characterized by deeply sculpted designs that stand out prominently from the coin’s surface. These coins typically feature intricate details and relief, creating a three-dimensional effect that enhances their visual appeal.
- American Gold Buffalo Coins: The American Gold Buffalo coin, crafted from 24-karat gold, is a bullion coin minted by the United States Mint. The obverse and reverse designs of the coin are intricately crafted, aiming to capture the splendor and grandeur of the American West alongside the rich heritage of Native American culture.
- Chinese Panda Series: The Chinese Panda coins are renowned for their annually changing designs, which feature the iconic panda in different poses or settings, reflecting China’s rich cultural heritage and biodiversity.
Licensed Collectibles You’ll Want to Show Off
Licensed collectibles are precious metal coins, rounds, or bars that feature popular films, sports, comic book characters, cartoons, or military services. The coins hold a monetary value in the issuing country and the rounds and bars carry bullion value.
Both carry extra value compared to simple bullion due to their rarity and collector’s value. These items, even the colorized versions, carry just as much gold as their more traditional bullion counterparts. The vast variety of options ensures that you can find a category for you to collect or to gift.
Marvel and DC Comics
If you are a fan of either or both franchises, you can buy bullion coins, rounds, and bars featuring your favorite movies or characters. Characters featured in gold include the Green Lantern, Iron Man, Spider-Man, Superman, Wonder Woman, and many more.
Popular Movie Franchises
A few of the featured movies include John Wick, DUNE, The Godfather, Star Wars, James Bond, and The Lord of the Rings series. Most of these types of bullion items have a limited mintage so they may gain value over time. For example, the gold coin commemorating the 50th anniversary of The Godfather has a limited mintage of 200.
Classic Rock
Bullion items celebrating the rock greats are available if you or someone you know loves classic rock. Some of the musicians featured include Aerosmith, Elton John, KISS, David Bowie, The Rolling Stones, and The Police.
Video Games
Many bullion items are available that celebrate modern and classic video games. Gold and silver items include bullion featuring Call of Duty, Pac-Man, Street Fighter, and Sonic the Hedgehog.
Top Ten Highest Prices Paid for Jewelry
The highest price ever paid for a piece of jewelry is difficult to pinpoint precisely, as it can vary depending on factors like auction records, private sales, and fluctuations in the market. However, notable examples include the Pink Star diamond, which sold for over $71 million at auction in 2017. These extraordinary prices reflect the rarity, quality, and historical significance of such exceptional gemstones.
It is worth noting that these rare items are often valued more for their gems than the metal. Some are not even set but are just the stones themselves. These are also items that the average investor may only see if they view them in a museum. Nonetheless, it is interesting to learn what a rare and historic piece of jewelry may go for at auction.
| Diamond Name | Sold for (Millions USD) |
| Pink Star | $71+ |
| Graff Pink | $46+ |
| Oppenheimer Blue | $57+ |
| Blue Moon | $48+ |
| Winston Blue | $23.8+ |
| Zoe | $32.6+ |
| Archduke Joseph | $21+ |
| Orange | $35+ |
| Perfect Pink | +14+ |
| Wittelsbach-Graff | $24.3+ |
Choosing jewelry or bullion depends on individual preferences, investment goals, and risk tolerance. By carefully considering factors such as liquidity, storage, maintenance, taxes, and diversification benefits, investors can make informed decisions to build resilient and balanced investment portfolios.
