More and more people are looking for profitable ways to passively earn and increase money in order to confidently think about the future. There are different ways to invest, but the experienced investor will usually use the few options available to increase his chances of success and reduce investment risk.
Assets in the form of gold coins, bullion, or items made of gold or silver are considered the least risky. Each case has a different level of risk and reward, but investing in jewelry is becoming more and more popular every year. Let’s see why this is happening.
Should I buy gold and silver jewelry?
Previously, in Ukraine, many people bought jewelry twice in their lives: when they got engaged and got married. On other occasions, such as anniversaries or important events, a silver pendant, a cross, and a pair of earrings were sufficient.
In India or China, where jewelry sells best, it also serves other functions, provided it is made of gold, silver, and precious stones.
In India, the period of religious holidays begins at the end of the year. This time is considered the best for making vows and marriage. During this time, jewelry sales are skyrocketing. For Indians and Chinese, gold necklaces, rings, bracelets are considered the best wedding gift or just a dowry — it is still customary to send their photos to the groom’s parents for a final decision.
In Ukraine, the realities of life are such that people often have to give priority to more important things. Wages in relation to the subsistence minimum in Ukraine are at least 3 times lower than in Germany, Great Britain and the USA. This is one of the main reasons that when a person is considering long-term and profitable investment options, he is more willing to spend a large amount on a new TV, computer, smartphone or car than on jewelry accessories. After all, it is a luxury, not a necessity. But items become obsolete very quickly. What is new today, tomorrow will cost a quarter less than the amount originally spent.
Unlike electronics, real estate, or clothing, jewelry serves multiple purposes as an investment. They combine practicality and location form. They don’t wear out and last forever. With careful handling, after a few tens or even hundreds of years, they will look the same as on the day they were purchased.
Buying a gold diamond ring or necklace is an investment in jewelry with multiple benefits.
- Precious metal items can rise in value because they are timeless and durable. If you suddenly need money urgently, you can always take it to a pawnshop, and then buy it back or sell it even at a higher price than before the acquisition;
- a combination of a location function with a utility function. Jewelery — Jewelry made of gold or silver is the perfect accessory that can also be used during a family celebration, carnival party or business meeting;
- small size, which makes it easy to transport them from place to place. If necessary, they can be quickly packed with jewelry, take them with you even on a trip to the other side of the globe, unlike other popular investments such as land, car, real estate;
- an investment in feelings, emotions and interpersonal relationships. It is the happiness they bring to their owners when they are worn or given to loved ones. Locking in a safe or keeping only in a casket deprives them of this value and soul, turning them into a purely physical product;
- a way to tell about yourself, provide relevant information in a business environment, develop business relationships where image is very important. After all, a person is often judged by the first impression. Thanks to well-chosen jewelry, confidence as a professional increases, which contributes to building business relationships.
Such benefits cannot be obtained by investing your savings in gold bullion, treasury bonds, opening a bank deposit or tracking the quotes of your shares on the stock exchange.
Is it profitable to invest in jewelry?
Remember world history: silver and gold are the heritage of ancient cultures. Precious ores do not succumb to the ravages of time like other metals. Thousand-year-old jewelry can still fulfill its function of utility, meaning investing in jewelry has outlived its investors. Since such antiques are priceless, they end up in museums, where visitors still marvel at their splendor.
In Ukrainian, and in world history, there were situations when the price of gold fell, so there is always a risk. However, over time, it returned to its original value, and then began to grow rapidly. This is because gold cannot be printed. It can no longer be mined or supernaturally produced. Pure gold is very rare in nature. Due to its noble properties, it will always be in price. Silver in its pure form is also not much, it is soft, so jewelry is made from its alloys. When rare gems are added, a unique and valuable product is obtained. Its value is determined by supply and demand.
In order for the price of a product to rise, its demand must increase and its supply must fall. Both factors depend on global trends and the exchange rate in Ukraine.
The production of jewelry goods consists of 4 components that obey the laws of supply and demand:
- design (attractiveness, fashion, accuracy of execution);
- manufactory (labor — manual or machine);
Each of them for different products will have a different meaning. In the case of diamond accessories, the stones will carry the most weight; for artistic jewelry, the situation will be similar to the art market. The main components of the investment will be design and production. They are more risky because they are difficult to describe with standard indicators. While investments in the 3rd and 4th components, that is, in ore and stones, are characterized by much simpler tools.
The weight of its individual components depends on the choice of the type of decoration. If it contains a lot of gems, the value will be determined by the price of the minerals. Artistic, handmade and unique jewelry will have more value due to the second component — production.
Brand awareness and reputation as a jewelry manufacturer can significantly affect its future value. This makes it easier to sell the product in the future because the brand tells the potential buyer why to buy their jewelry. They will delight you with their elegance and radiance, and can also be a long-term investment for generations, a kind of personal investment in the future of your children and grandchildren.
Do not wait for a good period when it is better to buy silver and gold jewelry, but start investing with small amounts right now. Familiarize yourself with the catalog, choose products that are affordable in terms of cost and order their delivery to your city of Ukraine.