Gold Value Calculations - How Professionals Arrive at a Price:
G'day again and welcome to my special three part submission on just how appraisers and Valuers arrive at an appraisal or Valuation Replacement price by using formulas and calculations to arrive at a final figure.
This is NOT difficult and anyone can do this with a simple high school calculator, and so I have included in this series of articles, not only that actual method or formulas used, but also a secret and easy to implement tool to arrive at the same result - but without all the hassle.
But first we need to lay the ground-work of just what a Gold Value Calculation can do - but more importantly what it can't do.
It does NOT calculate the major part of your gem-set jewelry - Yes you guessed it - Diamonds and Gemstones.
This is a simple valuation system for GOLD ONLY ITEMS of jewelry and can be utilized for any quality of gold in any color, and to almost any weight.
But because we all have some of those jewelry items around the house, then it's worth while breaking down the formulas to see how it works on Wedding Bands and Plain Signet Rings etc.
This same system can also get us a really good approximation or 'Ball Park' figure on Bracelets, Chains, Earrings, Brooches, Cuff links and Tie Bars. In fact ANYTHING which is made up from gold only (not mixed with other metals like silver or platinum), without being embellished with gemstones of any kind.
And while it's true that gemstones make up the MOST value in any jewelry appraisal or valuation, it should be remembered that if we lost our webbing ring or something else made from gold only, we would still need to know what the item was worth for replacement. Even if that replacement had NOTHING to do with an Insurance Company or not. It's also nice to know what you should sell an item for - or buy it at a fair price in the first place.
Yet the purists might say that we can't value an item based just on the weight, and I must agree with them to a certain degree. Certainly we do NOT take into account any Vintage or Antique Value, and we also do NOT take into account the condition or workmanship associated with each item.
We simply can't do that with a single formula or tool.
But we CAN arrive at 99% percent of general value just by taking into consideration the color, item, carat (karat) quality and the weight alone. These four factors when combined into the formula WILL give us a darned good approximation.So why don't we use that and accept it is NOT an appraisal. It's simply a Gold Value Calculation.
So before we get 'Down and Dirty' with the formulas, I want you all to get ONE ITEM of your gold only jewelry off the finger or from around your neck, and lets use that as your insight to the World of Jewelers and Appraisers and Antique Dealers and such, to try and understand just how they can calculate so quickly what something might be worth and arrive at a fair buying or selling price in their minds (experience not withstanding).
It's a couple of steps, but once you have mastered this - it's Gold in the Bank (sorry about the pun - I couldn't resist). So are your ready? Have you got your wedding Ring on the kitchen table (or next to your computer) because if you have then hopefully we can can get those four items of information together and get it valued...
In the next article in this three part series we are going to dissect the Gold Value Formula into it's component parts and see how it all fits together.
0 comments:
Post a Comment