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How to make money in gemstones

Hello All,
After looking lately at several posts requesting valuations on “gemstones” which, in the OP’s opinion are valuable treasures, I am posting this guide in self defense. Perhaps it is naive to expect that anyone will read this and follow any instructions, but…

In order to make money in gemstones, you first need to know gemology, so that you can be sure that the stones you buy really are natural, perhaps untreated, etc. You don’t need a $4000 certificate or any certificate at all, really, altho’ they are nice to have, but you do need to study the books and have the equipment to identify typical gemstones. This will take most people a while, perhaps a year or two. There are even a few free gemology courses on line which will help a good deal. The equipment you need, a loupe, perhaps a microscope, a dichroscope, diffraction grating spectorscope, refractometer, immersion fluid and a few filters, need not cost you more than $300 to $500.

Once you have some gemology education, you will need to purchase some gemstones, maybe just cheap stuff, and identify them and evaluate them. You’ll learn a lot about inclusions, colors, characteristics, etc. You’ll also need to do a lot of looking at gems for sale and at gem price guides…if nothing else, you can look at the free portions of gemval.com and see how inclusions and cut quality, etc. impacts valuation. Run some comparison mock appraisals. You can’t buy and sell gems confidently unless you know what is worth (lots of) money and what is not. Is a red garnet expensive? Is an included ruby worth money? An included emerald? Would you make money buying and selling amethyst? Peridot? Tourmaline? Spinel? You need to know the answers to these questions and many more. What is prime color sapphire? What color sapphire isn’t worth much? What size does a gem have to be to net you some money? And so on.

What you do not do if you want to make money in gems is:

  1. Accept a seller’s valuation of his products.
  2. Believe what you see on the envelope containing a gem found at your Aunt Hattie’s estate sale.
  3. Buy gems before you have “done your homework” as detailed above.
    4, Think that if something is too good to be true, it still is.

Most of the people making money in gemstones are cutters or long time dealers with access to stones in their country of origin or in the worldwide cutting centers abroad (from the USA and UK). They have incredible knowledge and a marketing presence that brings them buyers. They have the cash to buy in bulk at great discounts to the prices you will be offered for one or a few pieces. If you are to compete with them, you may have to accept a lower rat of return and do a lot of looking to find the rare good deal. Such is not for the faint of heart.

If, after reading all this, you still want to make money in gemstones, good luck! If you just went to work at Walmart instead of putting in the hours of work you’ll need to succeed, in the end you’d probably be ahead…but some with a passion for gems and a lot of energy will do it anyway. It isn’t impossible, it’s just difficult!
-royjohn

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Thank you Very well written and clear Is it possible to get suggestions on the makes and models dichroscope, spectroscope refractometer and filters you recommend

These days about any of the Chinese instruments are OK. The clone of the OPL (diffraction grating) spectroscope is about $30-35 and if you want a prism spectroscope, you can find that for about $85-100. Any calcite dichroscope will do, again about $35. I would stay away from the stuff coming out of India on general principles. I have never bought a gem instrument from India, but I know their brass musical instruments are horrible and the gems I see all look like swindles, so I’m just staying safe.

Last I looked the Chinese refractometers were about $85-$100. You might want to get one with a yellow filter and a light source if it looks good to you, for convenience. Of course, you also need the polarizing filter that should come with it. Make sure to buy all this with a return privilege, but esp. the refractometer, because sometimes they come out of calibration, so you need to check it when you get it with a piece of quartz, which is pretty much invariant.

Get a Chelsea filter and look at Hanneman’s various filters. These last are not required, but they are great for looking over parcels and making decisions quickly. If you were to spring for the whole set from Mineralabs, I think it would be about $250. Again, not required, but a lot of fun to play with and very useful if you are buying parcels of faceting rough or separating a lot of gemstones, like aqua from blue topaz. You can also get just the jade filter or emerald filters alone and they may be available as clones, IDK. Check ebay.

If you run into used GIA or other top brand instruments used, you can consider them, but they are not necessary, esp. at inflated prices. My old Duplex (GIA) refractometer was stolen out of my car several years ago (it was a used purchase in 1996 of $400 — no Chinese substitutes available then!) and I was able to replace it with a Rayner Dialdex for $240. I had always wanted one of these and it is a bit more accurate than the other refractometers, so I sprung for it. It’s a little dim in its old age, but still a bit more accurate…

Of course, a good stereo microscope is wonderful to have and old B&L and American Optical Zooms come up for sale on ebay. New ones are about $350, about the same as the old used ones…one thing I would not be without is a copy of Hanneman’s Affordable Gemology which will show you how to rig up darkfield illumination for your microscope, among a host of other things, including a refractometer which will read any RI up to 3.0 and beyond…in sum, unless you go for the set of Hanneman filters, you should be able to get done for about $650…using a loupe rather than the microscope, maybe $250-$300.

Hope this is helpful…these are merely my personal opinions…you can find lots of talk about this at Gemology on line, too. Happy Gemology!
-royjohn

4 Likes

really helpful. thank you have Great holidays

Thanks, that’s amazing and exceptional advice! I would say that 95% of people who I have seen try to make it in this business have failed, some in a few months, some lasted a few years, but the idea of ‘fast money’ seems to seems to be the key to the failure.

There is a kid who has become a sort of protege to me, he works 40 hours/week in a brick factory, and another 40 hours/week selling gems.

He is not the smartest young person I’ve met who is interested in the trade, he’s not the most skilled or even the best salesman (he IS a natural salesman though), but he is one of the hardest working!

I give him credit and pretty loose terms, he can return/exchange anything he can’t sell and because he lucked out and has someone like me behind him (partly due to his tenacity!), he has a pretty good chance of making it.

He’s also the reason I get mad when people crap on ‘millenials’, I always say ‘nope, you just don’t know the right kids!’

All of that said… I LOVE THIS BUSINESS!!!

4 Likes

Very well written. .This info should help the novice. The main thing is knowledge, obtained by cracking the books, and obtaining and learning to use your equipment.

Hope I’m not bugging you too much. I’ve been looking at refractometer. one was the Gem-A the other Kassoy. Big price difference, is there that big a difference in quality and ease of use? Also took your advice and bought the full set of mineral lab gem filter set and a chelsea filter.
Thank you again for the advice

HI Teezer,
I looked at the Gem-A on Amazon ($549) and the Kassoy at its website ($109). I can’t see that they do anything different, both having scales that read to 0.01 divisions. What you would need to query their vendors on is what light source there is…is there a yellow LED or some kind of yellow filter and whether they come (I should hope) with a polarizing filter or not. You need the filter and a yellow sodium wavelength filter or a yellow light source. The shapes are close enough that I suspect they may even have the same internal parts, altho’ that’s only a guess. Moreover, I see about the same (similar?) instrument on ebay for about $60 and see no reason to go above that price…just, as I said, get a return privilege, so you can return any defective one for another…sooner or later you’ll get one that is calibrated right, even if the first is defective. It’s just a QC issue.

The filters are really not a must-have, but they are fun to play with and great short cuts to ID, esp. of parcels. I think there’s a Chelsea filter in the Hannemann set, so you may be able to return the Chelsea filter and save some bucks. What you really should get is Hannemann’s book, which I see is now just $38! You could get the book and a cheapie ebay refractometer for the price of the Kassoy, altho’ Kassoy is a very reliable dealer, so you pick.

As for bugging me, help, I’m talking about gemology and can’t shut up…LOL…ask away…-royjohn

You are awesome. Have a great holidays. I"ll let you know my final setup. Thank you again, Tony

Hi Tony,
[Blush]…thanks…I forgot to mention, be sure to get the dichroscope and spectroscope, which are about essential and cheap enough. We are a far cry from the days before China and ebay when all you could get were a $800 GIA refractometer, a $1500 Gemscope, a $500 spectroscope, etc. For the instruments for a GIA gemologist’s course, you could easily go $3000+…and along came Hannemann and Hodgkinson (Visual Optics) and showed you could do most of what you needed to do with the naked eye, without instruments, and make a refractometer (you do need a darkened room) for all RIs for $20, plus the book, and a cheap SG balance (this was before the days of the $20 digital scale)…yet GIA would not teach any of Hannemann’s refinements for years after, acted like he didn’t exist. Finally the GIA Alumni sponsored workshops…they were working in the field and wanted the info…It’s an interesting story…-royjohn

From the Kassoy rep;
The GM181

-It comes with a polarizing filter
-It is an internal orange LED light
-Works on 3 watch batteries

  • you cant use another external type of light with this model.

RoyJohn is spot on. I followed the same path starting about 15 years ago building military aircraft 40 hours a week and working weekends buying selling and learning about gems and jewelry on the weekend. After 15 years, getting my GIA GG degree and 1.4 million in weekend sales I still build military aircraft, but, that income is only about half what I earn selling gems and jewelry on the weekends online. Royjohn description of how I built my business and had the success I have is my story to a T. With my experience, education, effort, passion and dedication to the industry I am having my best year yet. My largest obstacle is misinformation, ignorance and lack of education regarding gems and jewelry from folks who think they know what they know, but, are very wrong. This misinformation comes from various sources, people and outlets but if anyone ever questions any information much can be verified or debunked by going to GIA.EDU. Remember, jewelers are jewelers and Gemologists are Gemologists in some cases they are both but seldom is that the case. Some of the mostoytragous

wow this is probably the most helpful information I’ve ever gotten on the subject. I have a refractometer, but it doesn’t read above 1.84 . I have such a hard time figuring out so many gems that are above this . I almost gave up the craft, although after reading your response today I have to say you have reignited my passion. Thank you. Merry Christmas

Hi Donna,
Glad to have been of help. A reading of Hannemann’s book may help you in ID work. Hannemann was instrumental in pointing out that, if gems are unmounted, a measurement of SG is just as helpful as RI as a place to start the ID process. He developed a cheaply made SG balance that reads SG directly. However, since that time the cheap digital scale has come along and it’s easy enough to establish an SG with a small salad dressing cup of water and a digital scale. Just tare out the small cup of water to zero and take a measurement with the gem resting on the bottom of the cup, which is the true weight in air. Then, by fashioning some kind of loop of string or small cup out of very thin wire, weigh the gem suspended in the water. Thus the SG is easily found. Hannemann’s pinhole refractometer is also useful for RIs over 1.81. Your refractometer doesn’t read over 1.81 unless you are using some kind of really noxious RI liquid or paste.

Perhaps this is a place to plug Gemology Tools Professional software. For about $60, this software will guide your ID work. Just plug in what you do know about your unknown gem and the software will tell you your choices and you can decide what else to do to ID the gem. Look into gemstone magnetism as a cheap test and, with GT Pro, you have a pretty powerful tool. I don’t have any interest in this software and don’t actually have it myself yet, but I’ve seen it used in ID and it does simplify your problem, particularly if you don’t know every last thing about gemology.

I guess I should try to get some kickbacks from some of these folks, eh? Happy gemology and Seasons Greetings!
-royjohn

2 Likes

Very Awsome Topic,

My story of how I got into this stoney world is long so wont bore anyone with all that, but it started with stone chips to make dragon head organites to help raise money for a charity for a young lady needing life saving surgery.

Nutshell, I have been dancing around the edges for 3-4 years and simply got more and more interested in everything rocks and jewellery. I once threw a thunder egg over my shoulder, literally, while working remote Australia. Another chap coming behind me picked it up and informed what it was. In the last 8-12 months I have committed fully to creating a company, including purchasing stock etc, Im now in boots and all!

I know I need to read more, I know I need learn more, I know I need to develop my skills, and I know I need to take advice given here and act on it. At the moment the current learning curve is enormous and I am up to an almost “ready to go live” website…still learning in this curve too There is only one of me, and I could do with a couple more of me lol.

One day I will be investing in tools of this trade. Hopefully sooner rather that later, thank you for taking the time to share your knowledge Royjohn, and to every one else who shares their knowledge and thoughts on whatever topics. I have found this to be such a fantastic community and am so glad I bought myself a pro-membership for Xmas :slight_smile:

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Can you give me the name of the book or books written by Hahnemann? I haven’t been able to find anything. I would like to read more.

Donna

Hello Donna,

Hannemann’s book on gem ID is called Guide to Affordable Gemology. It is titled

that way because he had a long running argument with GIA, which at that time,

before Chinese imported cheap instruments, sold a kit that cost about $4000,

whereas Hannemann contended/contends that you can get by with a much

cheaper setup. The book is available for $38 from <mineralab.com>. They

also have his filter sets and lots of other goodies, altho’ some may be rather

expensive and available elsewhere cheaper. I have not checked to see if the

book could be found elsewhere (perhaps used?) cheaper, but I think they are

the only ones who carry it new. He also has an interesting booklet on classifying

garnets. Good luck with gemology, it is lots of fun!

Best,

royjohn

1 Like

I love reading royjohn and hope he’ll forgive my liberal quoting of his excellent work.

“If you just went to work at Walmart instead of putting in the hours of work you’ll need to succeed, in the end you’d probably be ahead…”

Coincidentally, the former owner/proprietor of a well known shoe-store in our area, in his sixties, now works at Walmart as a “greeter” at the door. None of his adult kids were interested in trying to keep the established shoe-store going. The Covid recession worldwide along with mass unemployment is likely to push many mines and rock-shops over the cliff. My guess: the bleeding in the mom 'n pop gem-industries will continue for at least three to four years. As usual, the big boys will mop up nicely along the way.

“…but some with a passion for gems and a lot of energy will do it anyway. It isn’t impossible, it’s just difficult!”

My guess, looking at the intl. arena, especially online, the most “new guys/gals” could hope for starting their gem biz from scratch is occasional lunch money.

Joining the big U.S. thieves in banking, health-care, insurance might be a lot easier. I heard of one guy making a killing operating his own old-fashioned hot dog stand.
I gather that TV selling still works? Would not know. My TV selling experience began and ended decades ago:

The Asian gemological equipment manufacturers, the intl. gemologist training biz and some you-tubers will hang in there because countless people simply love rocks and don’t care about making a buck with them.

Best wishes,
John

Hello John and All,
John, thanks [blush] for your kind comments on my writing. I try to be honest and make it entertaining and then “help, I’m talking about gems and can’t shut up…” Yes, it’s true that some of us just love gems and jewelry and will acquire the knowledge needed to succeed because it is fun for us. Then at some point, we might be able to make some money at it. I started cutting cabs in 1983. My wife and I knew and older couple, artist-craftspersons, and spent many happy hours in their kitchen talking. The husband was a lapidarist and taught my wife to cut a cab and I watched, went home and built a machine and learned to cut them. In 1996, a faceting machine became available and I taught myself to facet from books and what I’d seen in the craftsman’s shop years earlier. I took the GIA gemologist’s course by correspondence and continued learning from Hanneman’s book and articles. About the time I started faceting the internet was taking off, and this eventually led to contacts overseas. I also met the late Will Smith, who was one of the sparkplugs behind education at the Middle Tennessee Gem and Mineral Society. Will taught me a lot about faceting and we started the "Facetor’s Frolic’ in Franklin NC, which was a small gem show just for faceters and it ran for twelve years. Meeting professional and amateur faceters at these meetings led to more learning and buying and selling. I’m finally now at a point where I feel I probably won’t lose my shirt if I buy and sell gem rough and cut stones.

But it is still easy to get fooled if you are not careful. A few years ago I was looking through a pile of morganite at one of the Franklin show, most of which was about 10-15 carats. However, there was one large piece of several hundred carats for the same price per carat. I had bought from this gentleman the year before, so I trusted him and snapped it up for about $500. I got back to the Frolic and showed it to a friend who immediately pointed out that it was full of bubbles. Another friend, a crack gem dealer, took a piece of quartz and scratched it easily. It was obviously glass, but I’d been so taken with the great deal that was going to make me rich that I forgot all my gemology…the dealer was very nice and took the piece back and I witnessed the phone call as he talked to the guy whose morganite he was selling. They spoke some African language, but I could tell it was not a pleasant phone call. Somewhere along the way the parcel had been salted and maybe neither of these guys knew that…a lot of gem dealers visit the mines and buy, but don’t know much, if any, gemology. The parcel was quite possibly salted at the mine. I did an exchange with the dealer and took home a large piece of aqua instead, so things turned out OK.

That was not the first time I have been bamboozled or cheated, but I hope it is the last big one. My point is that just before that buy I had given a talk on buying and selling gem rough and yet I still made a very bad buy. Fortunately I bought from someone with ethics and it turned out OK. The gem world is not that big, so if you cultivate friends in it, you can always get good advice if you are unsure about a purchase. If someone has no reputation or selling history, be very careful. At present you have buyer protections if you use credit cards or Paypal and dealers generally will not cheat you outright because word spreads very fast on the internet. However, you still need to be aware that photos may look better than the stones you actually receive. Backgrounds that are not white or neutral gray are a tipoff that color is being distorted. You may be told the average weight of the parcel pieces, but there may be one big one and a lot of smalls…or you may be given a range that is distorted by one big piece. And so on…

Well, there I go again…have fun with gems and be careful!
-royjohn