An Etymological Dictionary of the German Language/Kleinod
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Kleinod, n., ‘jewel,’ from MidHG. kleinôt, n., with the variants kleinœte, kleinœde, n., lit. ‘fine, pretty thing,’ then ‘costliness, ornament,’ not recorded in OHG.; ôt is a suffix (see Heimat, Armut, and Einöde). Hence the derivative has retained another feature of the earlier varied senses.