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Buying Black Opals for Investment

If you look at the increase in value of opals over the last 50 years, opals are a significant investment, and your asset steadily increases over time. Expect to make small gains overnight when investing in opals like you would with some crypto-currencies like dogecoin or shiba-inu. When investing in opals, you should look at a long-term goal; they require much patience if you purchase with the idea of making money on them. They are more suited to a Warren Buffet-style investment strategy than an aggressive short-term day trader strategy. From a long-term perspective, opals are great investments. If you look at the last 50 years of black opals, they have steadily increased over time. We have never seen a decrease in the value of gem-quality black opals. Discoveries have become less and less over the years, and the scarcity and demand for good quality black opal have become much more significant.

Investing in opals is similar to investing in Gold. They are tangible assets, so they are not susceptible to market crashes like when investing in stocks, currencies or cryptocurrencies. They enjoy a steady increase over time. Unlike Gold, however, you cannot just walk into any bank or pawn shop and cash in. Opals do require some expertise to find the right buyer for the stone. To maximise your chances, follow some basics to ensure you are buying an opal that is easily sellable in the future. Tick the boxes of basic principles when buying; you should not be fined for more money in the future.

A great example of an Black Opal for investment

So, what should you look for when purchasing an opal for investment?

Body Tone

Traditionally, a deeper body tone is better; however, in recent years, many people purchase opals based more on their beauty rather than just the body tone of the opal. As an experienced opal buyer, I must consider both factors. It should not be a deal breaker if an opal is stunning but only has a lighter body tone. If an opal has a deep body tone but is not bright, has a boring colour combination and has no pattern, it is also not a deal-making opal. It is essential to consider many factors when investing in an opal.

red opal
Red Opals are always viewed favourability in the market

Rarity of Colors

Standard colours such as greens, deeper purples and ‘average’ blues are less desired than rarer colours in opals such as reds, rainbows and royal blues. Ensure you are choosing an opal with good-quality colours and brightness. If you think the colours look stunning, of course, others will as well! It always pays to ask your spouse/friend’s opinion on an opal before purchasing it!

Brightness and Quality of Polish

Always ensure that the colours in the Opal are bright and that the Opal is well-polished! It is also essential to know that if the seller is associated with the mining or polishing of the opals they are selling, a guarantee is offered for any potential future natural cracks in the Opal. Natural cracks are rare. However, they may occur if the Opal has been cut too soon after being mined. A seller should stand by their opals quality and offer a guarantee; if they do not, I do not recommend purchasing from them. Opal Galaxy offers a lifetime guarantee for natural cracks in our opals.

Rarity of Pattern

Owning a specific pattern such as ‘harlequin’ or ‘flagstone’ will hold high saleability over an opal with no pattern. Choosing an opal based on its rare pattern, for example, Chinese writing, pinfire, or peacock pattern, can tick many boxes over a more typical pattern, such as a simple flash or colour play opal.

Size / Shape / Usability

Ask yourself what this can be used for when purchasing Opal. Most Opal end buyers want to set the Opal in a ring or pendant. Is this opal ideal for a ring? How is the dome on it? What sort of setting will this opal suit (claw setting or bezel)? Are there any limitations to the setting because of some flaws in the Opal (e.g., is there some sand on the edge that may look bad if it is set in a claw with open sides?) What shapes are best for pendants? Often, freeform shapes are less desired in the market than proper shapes such as ovals or teardrops. If the Opal is a specimen, who do you intend to sell it to when you want to? It is much more complicated in our experience to sell a specimen opal than an opal that a jeweller can set.

Location of mine

People familiar with the geography of Lightning Ridge are usually able to tell the difference between a seam opal and a nobby opal, for example. Seam opal from Grawin and Mulga are often considered more commercial grade opal. If comparing top quality seam to nobby opal for investment, nine times out of 10, I would recommend opting for nobby opal as they are often viewed more favourably in the market and often have much deeper body tones and high domed oval shapes that come from the formation shape of a nobby opal. Mining locations such as Allawah, Allahs Rush, and what is commonly referred to as ‘town opal’ (mined close to the town of Lightning Ridge) are viewed favourably in the market. When purchasing high-end black opal for investment, it is recommended to learn the location of where the opal was mined.

rare black opal
A very rare Allahs Rush field Black Opal

Price

The most crucial factor to consider when purchasing an opal for investment is your initial purchase price. Make sure you compare the opal you are considering with opals in the market. Is the opal you are purchasing well-priced? Can you see in the future this opal being worth more money? As much as any seller can recommend an opal, it is always essential to research!

Legality of Purchasing Opals for Investment

If you are purchasing an opal as an investment to decrease your tax payable (e.g., on behalf of a business), it is always important to check your country’s tax laws. In Australia and many other countries, laws require that gemstone investments for tax write-offs be stored in a bank safe for most of its ownership.

If you are considering purchasing a black opal for investment and want our best recommendations, please contact us to discuss them.

TOP 3 CURRENT OPAL GALAXY OPALS RECOMMENDED FOR INVESTMENT

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