Gold in UAE: How can I buy or sell my gold jewelry with better profit margin? (2023)

Most gold jewelry buyers around the world are refusing to budge as prices are so high at the moment. But when prices start to fall, there is always a frenzy of gold jewelry shopping in various stores in the UAE.

Expats in the country have a long tradition of hoarding gold jewelry as a form of investment or personal savings. It is their shared belief that storing jewelry is more secure than storing cash in the bank and is an effective hedge against inflation.

For many gold lovers, the precious metal can provide much-needed help during emergencies, such as when a family member needs urgent medical attention, paying for a daughter's school fees, or paying mounting household bills.

Many find gold much more attractive than other luxury items because of the metal's unique qualities: perceived durability, purity, and value.

How do I buy cheap gold jewelry?

The first thing to do when dealing with gold jewelry is to know how to buy quality gold jewelry at the lowest possible prices.

Although gold prices are always going up, there are times when prices go down. Because these changes are spaced days or even hours apart, you may not know when to buy gold.

You may be wondering whether you should start selling gold jewelry when prices are going up, or how low you should let gold prices go before buying gold jewelry.

These are important factors to consider as the price and value of gold often increases, but even when it does, there is often a risk that you could incur a large loss.

Let's understand how to buy gold jewelry at the lowest possible prices so that you can later benefit from selling jewelry when prices recover.

But before we do that, how about we look at some of the basic terms that you should be familiar with as they are important terms whether you are a buyer or seller of high quality gold jewelry?

When and how should I buy gold jewelry?

Because gold is such a valuable precious metal, there is always a market where you can sell your gold in any form, be it gold coins and bars, gold jewelry, scrap gold or any other gold item.

If you have gold jewelry that you wish to sell, it is beneficial to know how much your gold may be worth before attempting to sell it.

In order to buy gold jewelry affordably and ultimately make a nice profit on future sales, consider the following on your buying journey to assess if you are getting a fair price for your gold. This will help you avoid gold buyers who might try to take advantage of you.

How do I determine the value of my gold?

The best way to appreciate gold jewelry is to appreciate the pieces. Determining the exact price of your gold items can be difficult as there are factors other than the market price of gold that determine an item's value.

No matter what type of gold items you have, you can rest assured that they are worth at least the market value of the gold they were made from. Knowing the following will help you get an idea of ​​the value of your gold jewelry before attempting to sell these items.

Equation for determining the price of gold

To get a better idea of ​​the dollar value and the corresponding dirham value of your gold items, you can use the gold price equation. Be sure to follow the steps below to get an accurate score using this equation:

Start by looking up the current market price of gold. The market price is constantly changing, so check online for the current price. The price is given as 31.1 grams per ounce. Therefore, the current price per gram is obtained by dividing the price per ounce by 31.1.

To determine the estimated price of an individual piece, you need to consider the carat. Divide the karat number by 24 and multiply that number by the price of gold per gram found in the previous step. This number gives you the gold cost per gram for that particular carat number.

You then need to multiply the gold cost per gram for that particular karat by the gram weight of the piece of gold. Weigh your piece of gold with a jewelry scale or a grocery scale if you can't get hold of a jewelry scale. Multiply your weight in grams by the cost per gram of your carat count found in the previous step.

For example: If the current market price of gold is $1500 (Dh5509.50) per ounce. Divide 1,500 by 31.1, the number of grams in a troy ounce. The price per gram is $48.23 (Dh 177.15).

If your jewelry is 14 carats, divide 14 by 24 and multiply that number by the price per gram: 14/24 = 0.5833, 48.23 x 0.5833 = 28.13, which equals $28.13 ( Dh 103.32) at the price per gram of 14 carat gold.

Weigh your piece of gold and multiply its weight in grams by the price per gram in carats. If your 14 carat piece weighs 5 grams, multiply 5 by 28.13. This equates to 140.65, which is the estimated price for a 5 gram piece of 14 karat gold in a market where gold is trading at $1,500 an ounce.

Checklist When Buying or Selling Gold - Important Factors to Consider

1. Know that precious metals prices are quite volatile, don't act impulsively

As with any other investment, the value of precious metals is very volatile. However, you must be careful in your decisions and not act too quickly if prices fall too quickly. Attrition is practically second nature in the jewelry business, gold traders explain.

You should examine your gold jewelry carefully, especially those that you intend to sell. Also think about the emotional value of the jewelry and only sell the gold pieces if you are sure they will fetch high value and high profit margins.

2. Appreciate jewelry

As mentioned above, you must rate the jewelry during the purchasing process. This is important for very intricate pieces of antique jewelry, especially those paid for by weight. For these ratings, please contact independent and trusted jewelers.

3. Determine the value of jewelry design versus. Material for gold jewelry

Often the scrap value of jewelry seems too low, but when scrap is melted down into bars, you can get a lot more value by selling those bars. But just check the hallmark on these metals before testing the gold's purity.

In other words, you need to know exactly what you have. This is the most important consideration to keep in mind as the gold jewelry you own is almost never pure gold.

Even solid gold is made from impure gold, which means that whether you're looking to sell 10k, 14k, or 18k gold jewelry, you need to understand the exact composition of the jewelry. Gold alloys contain gold in different percentages, and the higher the percentage of pure gold, the higher its value.

4. Find trustworthy buyers

Once you have determined the value of your gold jewelry, you need to find a reputable buyer to sell to.

First, the buyer must be licensed to purchase the gold, preferably in the state in which they live and conduct their business. Find out about their membership in reputable, registered and trusted associations.

This means that before you decide on a buyer, you should take some time to research and compare jewelry. Get bids from multiple companies and only choose a buyer after you're sure you'll do business with them.

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5. Document and consult the refund policy

You can do this by documenting and photographing everything you need to know about the jewelry. Check the lost jewelry refund policy and get an appraisal even for high quality jewelry.

6. Monitor the gold market price in real time

In order to sell gold properly and make a good profit, you need to know the real market prices of gold. As mentioned above, prices fluctuate almost daily, which means you need to do market research for gold on a daily basis.

Know the Risks: There are some downsides to buying gold jewelry

But is jewelry the best way to make money with gold? Can you offer higher returns than stocks or real estate? Will the bracelet you bought her bring you a sizable profit if you sell it when gold prices rise again?

Unlike coins and bullion, jewelry has additional fees that make it more expensive to buy in the first place. The additional costs also mean that you may not recover your capital even if prices rise.

Jewelers typically charge fees to cover the labor cost of creating a shiny raw gold necklace, ring, or bracelet. Then there are "waste charges" to cover the amount of gold that is wasted when the precious metal is cut, melted or soldered.

When it comes time to redeem your most prized possession, your jeweler may not buy it back based on the current spot gold market rate, as they will likely quote the wholesale rate or subtract manufacturing and scrap fees from the price. Wear and tear on your jewelry can also reduce its resale value.

It's important to keep these considerations in mind before committing to jewelry as an investment vehicle.

If you really need to get into the madness, the least you can do is ask your supplier if they can guarantee you'll buy the item back without reducing the manufacturing and scrap costs. If you choose unique design and good quality, you can also get good resale rate.

Therefore, before buying gold jewelry, decide what types of gold you want to buy and sell. You also need to decide what types of gold you want to trade.

Do you want to buy obsolete jewelry or broken jewelry to embellish and resell? New gold wedding rings or jewelery to resell or would you rather trade in raw gold?

You should also be able to decide who buys your gold. Scan the market to see where the demand for gold is coming from and who your competitors are selling to.

You can also form an alliance with jewelry stores in your area to supply them with gold, which they can also sell for profit. You can also look for gold wholesalers who would buy it from you in bulk.