A twinkle in investors' eyes

   

     

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'Auction houses are ringing up record prices for jewellery...'

SHARES or property used to sit on top of investment wish lists, but more people are starting to look at jewellery as part of their nest eggs.

With gold markets running hot, jewellery is being eagerly sought at auctions and the luxury goods companies are starting to take notice and increase their jewellery lines.

Auction houses have been revelling in the popularity of jewellery. Global auction houses Sotheby's and Christie's have both reported strong jewellery auctions worldwide.

 

Last year, Sotheby's auctioned a rare 110-carat yellow pear-shape diamond in Geneva for $11.9 million, and Christie's auction of the jewellery collection of the late Elizabeth Taylor in New York fetched a record-setting $US115 million ($115m). The collection comprised pieces from Bulgari, Cartier, Van Cleef & Arpels and Chanel.

 

Head of the jewellery and jadeite department of Christie's Asia, Vickie Sek, believes that jewellery can combine the virtues of being both useful now as a wearable piece and an investment.

"Many collectors acquire signed pieces because they appreciate their beauty and are passionate about such jewels," Sek says.

"Investment, I think, is not a priority but is present at the back of their minds. And this idea of 'investment value' does act as an incentive to continue looking for the rarest and most desirable jewels."

  

It is important for collectors to understand the markets and trends when looking for investment pieces. First of all, a collector must decide what type of jewellery they wish to buy and their budget.

"Signed, vintage jewels have always had a strong following, and more so today as examples from this period have become more and more difficult to find," Sek says.

"Period jewellery - Victorian, art nouveau, Art Deco or retro - has fared well for as long as I can remember.

"It will continue to do so as there are less and less pieces available in the market, and the workmanship of many of these pieces is of the highest quality."

 

Christie's sales of gems and natural pieces in Hong Kong attracted exceptional prices late last year. Two 35-carat flawless-type Illa brilliant-cut diamonds were the top lots at the sales, selling for $US8m.

  

Signed pieces from master jewellers such as Boucheron, Bulgari, Cartier, Van Cleef & Arpels and Harry Winston are very popular as they offer a desirable combination of rarity, quality and exclusivity, according to Sek.

While diamonds have always performed well in the market, coloured gemstones are greatly in demand.

"Apart from flawless white and rare coloured diamonds, buyers continue to source important coloured gemstones including Burmese rubies and jadeite, Kashmir and Burmese sapphires as well as Colombian emeralds," Sek says.

"All these gems have a consistent demand as they represent beauty, rarity and enduring value."

  

Andrew Shapiro, managing director of Shapiro Auctioneers in Sydney's eastern suburbs, believes that jewellery collectors must be well advised in their purchases.

"For the private collectors, people need to be educated and consult well," he says.

"Gemological reports must also be looked at. This shouldn't matter whether it is a $5000 piece or a high-end piece of $50,000 upwards. You must do your homework and don't be guided by what someone else says."

As demand for high-end gemstones increases, Australians are becoming more attuned to the investment possibilities.

"Australians like to collect pieces of Cartier and Bulgari. The Art Deco period will never go out of style, with the pizazz and style from the 1920s and 30s. Jewellery is driven by fashion and what the current trends are," Shapiro says.

"Jewellery is now in the top 10 when it comes to having a diverse portfolio. No longer is it just about cars, real estate and paintings."

  

Shapiro agrees that coloured stones are in demand, particularly rubies. He also believes that the cut of a diamond is important when buying a piece for a future investment. His company recently added a diamond specialist to its jewellery department as it sees these sparklers as a growth area over the next five to 10 years.

 

With Bulgari being popular with collectors, Bulgari managing director Australia Julie Ann Morrison believes that some of her clientele buy jewellery as an investment based not only on its monetary value, but also as an heirloom.

"I think there are a group of clients who are purchasing Bulgari, taking into account its investment value. These clients are quite knowledgeable about gems and also Bulgari heritage and design and therefore have developed a high level of appreciation and taste," Morrison says.

"However, they are collecting based primarily on their taste and they understand that by collecting Bulgari they are investing in heirlooms of value within the history of the decorative arts - but they do so with passion for the exceptional jewels they enjoy to own and wear.

"Our clients rarely sell their jewels, so their primary investment motivation is characterised by their pleasure in owning high-quality jewels of distinctive design rather than their tradable value at a future date. Jewellery is one of the most lasting objects which can be purchased and, unlike cars or fashion or most other products, it is passed down."

Jewellery is an important market for Bulgari, representing 46 per cent of total revenues. While diamonds are highly sought after at auction, Morrison adds that there is growing interest in coloured stones.

  

Jewellery spans a diversity of categories, so collectors aren't limited in their choice of investments. "Generally the categories do not determine the value, though obviously a necklace is most likely to be more valuable than any other category because it requires more gems and gold to make," Morrison says. "However, there are many examples of a ring with a rare jewel being more valuable than a necklace."

 

Cassandra Murnieks

  

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