Gold jewelry: time to sell or worth the wait.

Many are mistaken in believing that gold jewelry will become more expensive or cheaper in the same way as the price of the precious metal itself. In their minds, there is an opinion that if the rate of noble raw materials has grown, for example, by $ 100, then their gold earrings will also rise in price equivalent to this rate.

In fact, with jewelry made of gold and jewelry made of other precious metals, the situation is slightly different, and an increase or decrease in the cost of gold in the world does not always mean an increase in the price of jewelry in Russia!

Besides! In moments of crisis, the situation with gold and with gold products can be radically opposite. Jewelery may lose value while gold itself may rise.

Let’s try to figure out how the gold jewelry market will behave during the onset of the crisis and how much jewelry prices will change when demand falls.

Gold price chart for the first quarter of 2020 Gold price chart for the first quarter of 2020

The difference in pricing for gold and gold jewelry.

First of all, it should be understood that gold and gold jewelry are completely different things in terms of pricing.

If the price of gold as a raw material is fixed by the London Gold Market Fixing Limited based on production volumes, investor behavior and market demand, then the price of jewelry is formed mainly by the cost of raw materials and the extra charge for jewelry work itself — cultural value. That is, the cost of gold jewelry is equal to the cost of raw materials plus a surcharge for work. While the value of gold as a metal is equal to the cost of production plus a premium for demand, plus risks, plus investment prospects.

As one of the confirmations of the above, we can cite as an example the price of new collections of jewelry from well-known brands. At the time of release, they cost quite a lot of money. And after a couple of months, under the pressure of low demand, their price tag is often cut by almost half.

This once again confirms that a large part of the price of gold jewelry is the premium for jewelry work, which is regulated by the manufacturer and can be reduced by several times in moments of stagnation.

In simple terms, gold can rise, and jewelry can become cheaper.

An example of jewelry with stones that will be bought at the price of metal An example of jewelry with stones that will be bought at the price of metal

What Jewelry Should You Sell Today?

From the above, we understand that some types of gold jewelry can become cheaper even when gold itself becomes more expensive.

These types include products where the jewelry surcharge makes up the bulk of the cost. These can be limited or new collections of famous brands, custom-made jewelry, as well as accessories made in short series as a tribute to the current fashion.

To sell such products today, in my subjective opinion, is a very reasonable and, to a certain extent, even a profitable decision. In addition, I would recommend for sale items with precious stones, expensive inserts and jewelry with complex jewelry patterns. When buying for all this, a lot of money was paid, but when selling during a crisis, no one wants to pay for them.

As the crisis progresses, pawnshops will overflow with collateralized gold that no one will redeem. Therefore, they will make the purchase of designer jewelry at the lowest cost — at the price of metal. In this regard, it is better to drain the Tiffany earrings now, while people still have free money, and gold is at its peak.

At the same time, when it comes to “simple” gold items, such as chains of standard weaving, mass jewelry of the USSR and accessories of a large series. As for them, we can say the following: in any case, these luxury items will be valued only at the price of the metal due to their depreciated jewelry uniqueness. Only in rare cases can they be sold for more than the price tag of a pawnshop.

I sell such gold jewelry as metal prices rise. If the price tag exceeds $1,650 per ounce, then it’s time for me to take the gold to pawnshops.

PS / Magpie on the tail brought that a decree would soon be issued allowing the work of pawnshops in quarantine. SUBSCRIBE

I bought Russian gold for my wife. Haven’t given it yet but already regret it

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