Special Report

Nine Most Valuable Collectibles

6. Jewelry
> 10-yr. price change: 146%
> One-year price change: 2%
> Most expensive item sold: “Pink Star” diamond (1999)
> Price at auction: $83 million

The jewelry subindex rose 51% over the five years ending in June 2013, more than the subindexes of all but a few collectibles. Articles of jewelry often consist of precious metals, such as gold, and gems. While the jewelry market is less volatile than many other collectibles, the price of particular gems can vary widely due to supply constraints and import bans. For example, the price of rubies dropped in the 1990s after the discovery of a large deposit in Myanmar, but it has since risen again, especially after the added pressure of the recently renewed U.S. ban on imports from Myanmar. Despite limited gemstone supply, the market for luxury jewelry is still thriving. The current record sale is for a 59.6-carat diamond known as the “Pink Star,” which sold for $83 million last year. In February, Sotheby’s had to acquire the diamond when the winning bidder was unable to pay.

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7. Chinese ceramics
> 10-yr. price change: 83%
> One-year price change: 3%
> Most expensive item sold: Meiyintang “Chicken Cup” (16th century)
> Price at auction: $36 million

Despite recent doubts about the authenticity of Chinese ceramics due to a high volume of forgeries, the Chinese ceramics subindex rose by 83% in the decade ending in 2013. Interest peaked last year, when a 1,000-year-old Chinese bowl made during the Northern Song Dynasty, which was bought at a garage sale for $3, was subsequently sold at a Sotheby’s auction for $2.2 million. Considering the returns and high-value auction sales in 2013, investors may want to consider ceramics seriously. The market for early works of Chinese ceramic art does not appear to be slowing, either. Earlier this month, a Chinese art collector acquired a tiny, 500-year-old Ming dynasty white cup painted with chickens for a record $36 million at a Sotheby’s auction.

8. Watches
> 10-yr. price change: 83%
> One-year price change: 4%
> Most expensive ever sold: Henry Graves Supercomplication watch (1933)
> Price at auction: $11 million

The watch market subindex in the KFLII returned 83% in the 10-year period ending June 2013, but it only rose 4% in value for the year ending June 2013. Christie’s and Sotheby’s reported selling half a dozen watches for more than $2 million apiece between June 2012 and June 2013, significantly more than in previous periods. The most expensive watch ever sold at auction was the Henry Graves “supercomplication” watch by Patek Philippe, which sold for $11 million at a Sotheby’s auction in 1999. According to the 2014 World Watch Report by luxury items research firm Digital Luxury Group, global interest in Swiss luxury watches grew in 2013. Demand from China for luxury Swiss watches increased by 59.4%.

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9. Antique furniture
> 10-yr. price change: -19%
> One-year price change: -3%
> Most expensive item sold: The Badminton Cabinet (17th century)
> Price at auction: $36 million

The antique furniture market measured by the KFLII dropped by 3% in 2013 and by 19% over 10 years, making it the only subindex to lose value. According to the Knight Frank’s report, “furniture continues to lose ground as antique styles decline in popularity with homeowners.” Furniture that was once considered classic such as china hutches and roll top desks have fallen out of favor. For collectors and wealth investors, however, there are still major pieces of antique furniture in the market. The Badminton Cabinet built in England in the 18th century fetched $36 million at a Christie’s auction in 2004, making it the most expensive piece of antique furniture ever sold.