Last Christmas, my mother gifted me antique wooden box. Inside were several pieces of family jewelry with which the aunts had decided I was now to be entrusted.
Among them, a string of perfect pearls that belonged to my grandmother… a small diamond and garnet pendant of my great-grandmother’s… a stately, square-cut emerald ring my Aunt Clara used to wear on special occasions…
And a hand-carved silver belt buckle accompanied by a small velvet pouch of smooth oblong stones. Each stone had been carefully cut and polished to fit the setting in the center of the buckle by my great-great-grandfather. He was the one who hand-carved the silver too.
The stones are lovely all by themselves — from tiger’s eye to turquoise, there’s one for every outfit. Problem is I’m not a regular wearer of belts, so they mostly stay tucked safely in a drawer.
When I read Jim’s question, I immediately thought about these heirlooms — and wondered if, indeed, there was any value to them besides the sentimental. So I tapped into our network of experts and aficionados here at Unconventional Wealth.
Here is what I learned.
Solid as a Rock
There’s a saying when it comes to mineral investing, “Better rocks than stocks.” Makes sense — mining stocks do tend to be particularly volatile. Plus, minerals and gemstones — like many of the alternative assets we cover — add beauty and value to your life.
They can also add value to your portfolio… if you don’t mind waiting 10 or 20 years. One mineral dealer puts mineral appreciation at 7% annually, meaning their value will double about every 10 years.
That number, of course, is a very rough average. Some stones appreciate much faster. Tanzanite, for example, is only found in one mine at the foot of Mount Kilimanjaro in the Manyara Region of northern Tanzania.
Due to this natural exclusivity, this exquisite indigo gemstone is highly coveted. Current pricing is $300–450 per carat. Since no one know how much longer these gems will be found, their value is expected to skyrocket as supply dwindles.
Alexandrite is another example. Quality specimens have a rising value of 25% annually.
Tsavorite, a variety of garnet, is also a desirable, top-quality gem. Values have increased some 30–40% since it first came on the market.
The bottom line is fine minerals and gemstones are generally safer than conventional assets — traditionally, they’ve been considered a safe haven against inflation and they are also relatively easy to sell.
But if you’re new to investing in precious or semiprecious gemstones, be prepared to hold tight for at least 10 years for long-term results — even if you opt for the more popular stones.
Also, keep in mind that minerals and gems are a niche market. You’re going to have to do a helluva lot of research to be able to swim with the big fish.
However, if you’re like Jim and you already have a sizable collection, how do you know if it’s worth anything?
Well, you’ve got to put in a little effort…
It’s Not Work If You Enjoy It
First things first, catalog your collection. Give each specimen a unique name or number and note its mineral and varietal names, the year mined and the mine name and any specifics you have such as depth of find or level. Also, include the price you paid, and any other details regarding their provenance, which can also be helpful in determining value.
Consult reliable references like John Sinkankas’ Field Collecting Gemstones and Minerals; Gems & Gemology, the journal of the Gemological Institute of America; and The Mineralogical Record, the world’s foremost publication for mineral collectors.
As part of your research, it’s important to talk to other collectors. Find an internet forum and see what folks are buzzing about or join a club in your area and meet fellow collectors in person. (The American Federation of Mineralogical Societies lists contact information for many local collecting clubs here.)
Attend expos and events… develop relationships with select dealers… gather the tools of the trade… learn how to properly trim and display your collection… It sounds like a lot, but if you like doing these things, they won’t seem like work.
That’s one of the biggest benefits of investing in alternative assets — you can turn your passion into profit and have a whole lot of fun doing it.
Jim — I’d love to hear more about your collection, and if you decide to follow any of the steps above to see what your specimens may be worth.
Lucille St. John
Managing Editor, Unconventional Wealth
P.S. Want to invest in minerals? Digging the inflation protection they provide? Don’t already have a collection like Jim’s? Don’t worry. Here is a super-easy way anyone can invest in minerals. See, precious metals like gold, silver, platinum and palladium are also an excellent hedge against inflation. Buy only the physical stuff — ETFs won’t cut it — so open your free account today.
Lucille St. John
Lucille St. John is the managing editor of Unconventional Wealth. A gentlewoman and a scholar, Lucille never received much in the way of a financial education. But what she lacks in fiscal knowledge she makes up for in taste.
She’s going to take you with her on her unconventional wealth journey — starting from...