While shopping around for jewelry can be fun, it also has the potential to immediately become stressful if you’re aiming to buy an expensive piece. Since purchasing a platinum or gold ring is so taxing, you can imagine why investing in jewelry is a demanding task that should be treated just as seriously as any other business transaction. In spite of the fact that jewelry is not a popular investment, let’s not forget that vintage and antique items will provide you with a substantial return. Before you take this step, it’s important to understand how this investment works. Let’s elaborate.

Understand retailer margins

The first thing you should learn about jewelry is that purchasing a new trinket from a luxury or high street retailer losses its investment value immediately. The problem with new piece is that they’re subjected to VATs up to 20%. In addition, the retailer can impose a 100% markup over the wholesaler’s price, cash that he mostly uses to pay for the utilities of their sumptuous and appealing shops.

Therefore, if you decide to invest $300 in a piece of jewelry with the intention of selling it in the following days, chances are you will recuperate a third of your investment in the best case scenario. The paramount fact to remember about investing in jewelry is that it takes 30 years to recoup their original value.

Be careful with the limited edition fashion jewelry

In general, it is wise to stay away from fashion jewelry because you have no way of telling whether the designer is using the “limited edition” label as a marketing tool. Considering that fashion trends tend to fade quickly and abruptly, the truth is that these items can lose their value even faster than high street jewelry.

Nevertheless, don’t cross designer jewelry off your investment list just yet. In the event that you come across an attractive and original piece from a young, promising designer, go ahead and acquire it. Because most operate with low production and marketing costs, it could turn out to be an interesting investment with a considerable return if that designer becomes a nationwide or even global sensation.

Vintage jewelry is always a good choice

The only category of trinkets you should always invest in with confidence consists of the Art Deco pieces manufactured between 1920 and 1935. Their popularity stems from their fantastic, strong and linear designs, a style that looks contemporary to this day. A further reason why Art Deco jewelry makes a good investment stems from the fact that they incorporate rubies, sapphires, emeralds and diamonds, namely precious stone with intrinsic value. All in all, anything signed by Van Cleef, Arpels or Cartier is of exceptional value and will provide a substantial return.

You should however, be careful about investing in antique jewelry. While it is true that furniture increases in value while it gets older, the rule doesn’t apply to all pieces. Look at the Victorian jewelry for instance; their design is simply too fussy for the modern taste. Moreover, there’s a slight chance the original stones were replaced with paste stones!