Looking to invest in some colored stones. General questions.

[Rock1979]

Just looking for some general information on investing in some colored stones to add a little diversity to my portfolio.

Most of my retirement is in the form of properties and rentals. I'm also the sole recipient of my Grandma's retirement (parents are passed away) which is in the form of mostly mutual funds. I started buying silver, gold, and platinum bullion many years ago and have reached my goal recently (about 10k in intrinsic value)
I would like to purchase at around 5-10k in stones as well.

I'm not looking to make a bunch of money off of these stones. I'm just looking for low risk stones that I can pay a few hundred dollars for here and there over the next few decades that will appreciate at the rate of inflation. These will sit in a safe until I retire in 25 years or possible until they're passed on to my children.

If one where looking for stones of this description, where and how would one go about obtaining them? I know a guy that says he buys untreated IGI Emeralds and sapphires once in a while off of Ebay and other online auctions as a way of storing money in increments, But I'm looking for something that's a little safer than that being that I'm not very knowledgeable in regards to precious gems.

Any suggestions???

 

[digdeep]

Gemstones are investments of the heart..............a personal collection, symbol of relationships, or tribute to memories.

 

[Rock1979]

Gemstones are investments of the heart..............a personal collection, symbol of relationships, or tribute to memories.

That sounds like a De Beers slogan........good grief

 

[leukolenos]

It may sound like a slogan, but it’s true. You are not likely to get any return on your investment purchasing stones. I wouldn’t consider them an investment at all.

 

[Bron357]

The best money to be made in gemstones is either to dig them out of the ground or be the dealer who sells them to people like you.
No offense, but gems just don’t appreciate in line with inflation, or anything else.
They don’t earn any income while sitting in your safe and actually cost money every year if they are insured.
And when the time comes to sell them, to whom do you sell?
The only “real” people who buy gems are either jewelers / designers looking to create jewellery or the rare individual looking to buy a gem separately to create a piece of jewellery. And these groups go to the “professional vendors”, those sellers with a huge inventory, excellent reputation and a good return policy (if it’s not as photographed for eg).
There is only a small select group of ordinary folk who buy gems to just “have” and most of these people are doing it for love and enjoyment, they are usually thankful to not “lose” money if and when they sell.
Buying gems off eBay?
I’ve been buying on eBay over 12 years. I have had an interest in and done personal study of gems for over 30 years. I would never buy a gem off ebay.
99% of the gem sellers are from India / China/ Thailand. They sell gems that are at worst totally fake or at best, treated. They provide “reports” from Labs or appraisers no one in the “industry” has heard of, labs and appraisers with no reputation. Misleading or fake reports even.
It can cost a few hundred dollars to have a recognised and well regarded GIA or similiar report done, unless you’re paying thousands for a gem maybe that expense isn’t worth it. If you do find out your gem is not as described, maybe you can return it, but you’ll still be out of pocket the money for a report.
If you’re interested in gems, do some study. Buy gems if you want to create jewellery or because you love them.
Just dont buy them with the intention to make money, it’s unlikely to happen.
Perhaps buy gold bullion instead, that never goes out of fashion and has a ready secondary market.

 

[chroman]

I wouldn’t, for everything Bron357 said...

That said, if you absolutely were hell bent on it, you wouldnt want to go the route of amassing a stash of few-hundred-dollar stones. More likely your target budget would cover 1-2 nice “classic” stones that might have a prayer of liquidity..

 

[Rock1979]

One thing I have found with enthusiasts of any hobby or interests is that talking about investing in said hobby or interests typically results in a negative response.

I collect firearms and have a few that would be considered "investment grade." I know for a fact that certain rare classic firearms not only hold their value, but aren't very difficult to liquidate these days because of online sales. If I were to go on a gun forum and ask which types of firearms are the best to invest in, there would be a flood of responses that would be pretty much a carbon copy of the responses on this forum thus far. The general consensus would be that you buy guns because you're passionate about them and enjoy shooting them, not to just stick in a safe and liquidate them in a pinch or for a profit at a future date. I'm a musician and own a few classic guitars that I would consider "investment grade as well." Lots of rare or even very common high end classic guitars appreciate at or better than the rate of inflation, yet if you went on a musical instrument forum, you would get the same old song and dance......"buy guitars because you love to play music and appreciate the arts bla bla bla."

The point in investing in something like precious loose stones wouldn't be to make any money off of them. If would simply be to physically own something of value that doesn't really depreciate. Too many people stick all of their money into the market or into bonds without physically owning anything of real value other than their home or vehicles. While I'm not a conspiracy theorists, history is shown that major financial collapses are possible and do happen. Owning a few things that of value such as precious metals, firearms, musical instruments, tools, or precious stones doesn't seem like that crazy of an idea providing one doesn't get carried away with it and recognizes that these are not investments that are going to make you money. They're more like an insurance policy or something nice to leave your family. Well, that's how I look at it anyways

 

[2Neesers]

A fine blue sapphire should always be a safe bet for resale down the road. It would be a good idea to research ideal colors (no inky blue) and always purchase from a reputable seller. There are too many very real looking fakes out there. Also know that 20 years down the road when you go to sell it that most buyers will expect a lab report from GIA or AGL. They run around $70 at this time. Possibly Tsavorite and Chrysoberyl prices might hold up too, but again, spend a little extra now and purchase from one of the PS recommended vendors or you could find out you have a really lovely piece of cut glass 20 years from now...

 

[leukolenos]

I get what you’re saying, and I do agree that it’s worth having real things of value. However, even being a gem lover, I still think that gold is a better physical value store. It is much easier to liquidate and has an easy to define value- $X/oz or gram. Diamonds and colored stones, not so much. Even if you’re talking objectively high end material, say, untreated Burmese rubies, even within that class itself the price swing is enormous.

Being the stone lovers that we are here, I don’t think anyone would try to talk you out of a stone purchase if that’s what you really wanted...we can be world class enablers BUT this is also a consumer education forum, so people take rather seriously making sure other consumers get the best value to suit their needs. I think the responses given here so far are less negative and more dialed into your goal to invest in hard assets, which realistically, readily available to the consumer (especially ebay...) stones are decidedly not.

 

[chroman]

We get the gamut of “investing” queries here, from people buying ebay gravel to folks serious about stones as a wealth storage vehicle. If you’re experienced in the collectable realm and all that goes with that, fair enough! At least you’re not asking about cryptocurrency

The first step I’d suggest is education - help develop your eye. I’ll agree with leukolenos about us being enablers, so feel free to ask for opinions on stones you see during this process.

I’d start by honing your eye for ruby, blue sapphire, or emerald, as they’ve been popular for a long time. But they’re also not cheap, so don’t expect to be picking up good ebay deals..

Expanding to a wider set of gems, I might look at really nice spinel or tsaverite, and possibly other members of the garnet family. They’re not quite as pricey, but can have amazing color. Where will the market go? Who knows.. Peridot once was really pricey...

 

[Rock1979]

I get what you’re saying, and I do agree that it’s worth having real things of value. However, even being a gem lover, I still think that gold is a better physical value store. It is much easier to liquidate and has an easy to define value- $X/oz or gram. Diamonds and colored stones, not so much. Even if you’re talking objectively high end material, say, untreated Burmese rubies, even within that class itself the price swing is enormous.

Being the stone lovers that we are here, I don’t think anyone would try to talk you out of a stone purchase if that’s what you really wanted...we can be world class enablers BUT this is also a consumer education forum, so people take rather seriously making sure other consumers get the best value to suit their needs. I think the responses given here so far are less negative and more dialed into your goal to invest in hard assets, which realistically, readily available to the consumer (especially ebay...) stones are decidedly not.

Well, this is the thing. I have over 10k in precious metals (intrinsic value), and probably MUCH more being that a large majority of my bullion is in the form of Canadian maple leaves and American Eagle coins. I have far more silver than Gold, but I still have a good amount of gold. Most of it is in the form of RMC and Perth mint 1 gram bars. I own some 1 gram bars of platinum too, but not a lot. Probably less than $500 worth (intrinsic value).

Some people are saying to buy Platinum and palladium like mad because they're going to explode due to their industrial uses, so that is something to think about. My whole thing with gems is merely the notion of diversifying. Like I said, physically owning things that are actually worth something is worthwhile IMO. My thing is that I don't have the income or disposable cash to just go drop 5k on a certified untreated Colombian Emerald or a Burmese Ruby with all the right paperwork (I've been doing a little reading since starting this thread). I'm looking to slowly build up a stockpile like I have with gold and silver. I would like to simply spend a few hundred dollars at a time for many years.

If that is not possible or is strongly ill-advised, please set me straight right now, and I will put my extra cash that I set aside to invest into physical goods into something different. I'm thinking about more platinum and some palladium. Maybe some even more exotic metals like Rhodium or germanium.

 

[Rock1979]

A fine blue sapphire should always be a safe bet for resale down the road. It would be a good idea to research ideal colors (no inky blue) and always purchase from a reputable seller. There are too many very real looking fakes out there. Also know that 20 years down the road when you go to sell it that most buyers will expect a lab report from GIA or AGL. They run around $70 at this time. Possibly Tsavorite and Chrysoberyl prices might hold up too, but again, spend a little extra now and purchase from one of the PS recommended vendors or you could find out you have a really lovely piece of cut glass 20 years from now...

So if I buy a stone that already has a lab report from GIA or AGL, will I need another report to sell the stone many years down the road?

 

[Bron357]

We are enablers here, we are all gem obsessed, but I for one feel obliged to point out the problems with gems (and art, stamps and coins) as an investment.
In my working days I was a financial planner and then moved into compliance and dispute resolution. I often dealt with the sad side of alternative investments ie all those investors who bought pine trees, or pig farms etc etc. like people losing A LOT of money.
Some investments are solid and have a ready, well regulated and healthy secondary markets. Others don’t. You need a healthy, stable secondary market for when you want to (or need to) sell, so you can do so.
In specialised markets, like loose gems, you have a few things against you. Firstly, without a few decades of experience it’s hard to find someone to advise you accurately and honestly. Did you know Amythests used to be very expensive? Then they found a countries worth (well almost) in Brazil.
More locally here in Australia, our Arygle mine found lots of insipid pale yellow and murky brown diamonds - previously virtually unsaleable. Enter the marketing gurus and ta da “Champagne diamonds” and “Cognac diamonds”. Anyone who bought them back in the 1990s are still waiting for the demand and price to come back. They might wait forever!
One of the issues with alternative investment markets is that they are often “fad driven”,so anyone thinking of investing in black diamonds or “salt and pepper” diamonds - one word- don’t. Now is the time to be selling these, not buying them!
Gems for investment purposes are a bit like stamps for investment. There are some superb and extremely valuable and desirable rare stamps and lucky whoever owns them, but my stamp collection isn’t worth the paper those pictures are printed on. Gems that only cost a few hundred dollars are like my those stamps in my stamp collection. Nice and pretty, but at this level of “collectibility” anyone who wants them already has a pile of their own. When you buy collectibles that are plentiful, they are plentiful. So if you buy a loose sapphire when you come to resell, maybe eBay, you come face to face with 20,006 similiar such listings.
I have a lot of gemstones, but in jewellery. This is sort of an investment. I don’t buy them new, only preloved (no retail mark up, no taxes) and I buy a lot on eBay (no buyer fees, unlike auctions were both buyers and sellers pay commission). I wear my jewellery and enjoy my gems. And when it comes to selling them, being in jewellery, they are far more saleable than a loose gem. And I’ve been enjoying them in the meantime.
So, buy best quality gemstones if you want an “investment”, otherwise buy them pre loved in jewellery for enjoyment.

 

[leukolenos]

Well, this is the thing. I have over 10k in precious metals (intrinsic value), and probably MUCH more being that a large majority of my bullion is in the form of Canadian maple leaves and American Eagle coins. I have far more silver than Gold, but I still have a good amount of gold. Most of it is in the form of RMC and Perth mint 1 gram bars. I own some 1 gram bars of platinum too, but not a lot. Probably less than $500 worth (intrinsic value).

Some people are saying to buy Platinum and palladium like mad because they're going to explode due to their industrial uses, so that is something to think about. My whole thing with gems is merely the notion of diversifying. Like I said, physically owning things that are actually worth something is worthwhile IMO. My thing is that I don't have the income or disposable cash to just go drop 5k on a certified untreated Colombian Emerald or a Burmese Ruby with all the right paperwork (I've been doing a little reading since starting this thread). I'm looking to slowly build up a stockpile like I have with gold and silver. I would like to simply spend a few hundred dollars at a time for many years.

If that is not possible or is strongly ill-advised, please set me straight right now, and I will put my extra cash that I set aside to invest into physical goods into something different. I'm thinking about more platinum and some palladium. Maybe some even more exotic metals like Rhodium or germanium.

I do not think it’s feasible to do with a few hundred dollars at a time.
Example: There was a chap on here this week shopping for a ruby for an engagement ring. He wanted Burma, no heat and over one carat for $5k. He has a VERY difficult search.
I am shopping for a ruby myself. My budget is approx $10k....and I’m not finding much out there that doesn’t require some compromises.

Even if you had a very large budget, I don’t think it’s advisable because they are so illiquid and difficult to sell, even nice stones, even trying to sell with no time line. If they are viewed as an insurance policy as you say, then you would likely be needing to liquidate in a hurry in which case you would take a huge hit, even with trade ideal stones in substantial sizes.

 

[2Neesers]

So if I buy a stone that already has a lab report from GIA or AGL, will I need another report to sell the stone many years down the road?

I think in most cases it would be okay to only have the old report. If you did happen to purchase something that had greatly increased in value, it would be worth it to spring for an updated report.
I found this thread from a while back on this type of subject that I thought would be worth sharing:
https://www.pricescope.com/communit...s-are-arguably-most-undervalued-today.180092/

 

[Rock1979]

I do not think it’s feasible to do with a few hundred dollars at a time.
Example: There was a chap on here this week shopping for a ruby for an engagement ring. He wanted Burma, no heat and over one carat for $5k. He has a VERY difficult search.
I am shopping for a ruby myself. My budget is approx $10k....and I’m not finding much out there that doesn’t require some compromises.

Even if you had a very large budget, I don’t think it’s advisable because they are so illiquid and difficult to sell, even nice stones, even trying to sell with no time line. If they are viewed as an insurance policy as you say, then you would likely be needing to liquidate in a hurry in which case you would take a huge hit, even with trade ideal stones in substantial sizes.

Sounds like it's go big or go home with precious gems in regards to investments.
Interesting, I'm glad I looked into it at least. You learn something new everyday.

Thanks a ton!

 

[chroman]

Sounds like it's go big or go home with precious gems in regards to investments.

If you’re just wanting something to hold value, and arn’t looking for appreciation, then I suspect you’d want a stone which already has a price premium - but not a trendy stone (so no paraiba, tanzanite, grandiderite, etc). And those won’t come cheap.

OTOH, the bigger you go the smaller the already small market gets. Trying to sell a 5ct sapphire is a totallt different market from a 1ct sapphire.

So big, but maybe not too big.

Trying to buy for appreciation seems extremely risky given the swings in demand and supply in the markets..

(Full discloser - Personally if I just wanted to keep up with inflation I’d take a position in TIPS, not gems, so I’m not really endorsing this plan)

 

[kenny]

The point in investing in something like precious loose stones wouldn't be to make any money off of them. If would simply be to physically own something of value that doesn't really depreciate.

Gems are not an investment because, unlike gold, gems are not a commodity.
Whether you are buyer or seller, pro or civilian, an ounce of gold sells at one universally-agreed-to price worldwide, (plus a relatively small commission).
There is no wholesale vs. retail price for gold.

Not so with gems.
Very not so.

We in the public must pay retail for gems.
But when selling we almost always must sell at a wholesale price, often paying a very large percentage as a commission if we have a pro sell for us.
Also, you can sell gold in a few minutes while it can take months or years to sell a gem, especially if you stubbornly hold out for your high price.

You wrote, "It would simply be to physically own something of value that doesn't really depreciate."
If wholesale is 50% of retail, I'd call that depreciation.
With what other kind of "investment" do you have to wait decades for the value to double (if ever) just to break even?

Buy gems because you love them, or need to move millions of dollars hidden in the seam of your coat.
There are exceptions but nearly always you will sell a gem for less than what you paid.

 

[smitcompton]

Hi,

OK, gems are not a good investment. However, there are some of us that can say that we purchased some stones 13 or 14 yrs ago and even we didn't make money, would not lose money. Since you only want to spend a few hundred at a time, you can't go after the big 4, diamond, emerald ruby and sapphire. You can go after some stones that have a scarcity of mining sites, thus the stone is scarce.
I love tsavorite garnet,which can found in Kenya and Tanzania, and if you watch loope-troop you might find something reasonably priced there. I might also look at ethopian opals, (very reasonably priced). I also might look at Mexican fire opals, orange or red ones. I have both jewelry and stones and enjoy both. I hope people comment on my choices. You will not go broke. If you have daughters, the future for them would be rosy.
Boulder opal-- you could wear this stone. Some are gorgeous. A good piece of turquoise, or lapis.
You can have the most fun tracking down best colors for best price.

Annette