Sparkling investment: Jewelry prices rise outperform classic luxury cars

Have you ever wondered why the ultra-wealthy often like to make investments on expensive luxury items? Most of the time, you can see them bidding for the largest gemstones, buying an expensive limited edition luxury bag or acquiring the rarest luxury vehicle.

There are a variety of reasons why the wealthy often invest on these items, and one of these is the strong emotional attachment people have for luxury goods.

Jewelry over cars

One such luxury investment that people will have a strong emotional attachment to is jewelry. It’s often given as a gift for special events, such as weddings, anniversaries or birthdays. That’s why it’s no wonder that jewelry topped the Knight Frank Luxury Investment Index (KNFLII), an index that tracks the price growth of luxury sectors.

According to the KNFLII, jewelry prices rose four percent in the year to the second quarter of 2017. The sparklers also replaced classic cars. Classic luxury auto slid down to sixth place and its prices rising just two percent in the same quarter. In the last 10 years, the KNFLII said that jewelry rose in value by 142 percent. Pearls were the top performer, up 282 percent. Jewelry pieces from the Belle Époque and Art Deco era are setting the pace for jewelry prices as it rose 93 percent in the last decade.

Investing in jewelry

Simon Teakle,  former head of the jewelry department of Christie’s New York, said that investing in jewelry is similar to buying fine art. If you invest in jewelry, it also becomes part of your portfolio. Teakle added that investors should not buy jewelry as a short-term investment if you aren’t in the business. When buying jewelry with investing in mind, Teakle said that you should be critical when it comes to quality and condition.

The wealthy people are investing now on high-end jewelry because of its emotional and luxurious appeal. (Source)

Meanwhile, antique and jewelry expert Michael Khourdipour said that there are trends in the jewelry business. If you plan to invest in jewelry, have patience in riding the waves. Hold on to pieces while carefully maintaining them. For example, if you bought a rare piece, it would have retained its value and its price would have appreciated.

According to luxury jeweler Le Vian, jewelry trends for 2018 include a preference for precious gems such as rubies and sapphires, while the color trend of the year will stick to red, white and blue. On the other hand, seasonal colors would include denim for fall and nude for spring. Jewelry setting for the next year would be bezel, while the fashionable way of wearing jewelry would have to be stacking and layering.