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Diamonds As An Investment

We all know about buying diamonds for adornment, but what about buying these precious stones for investment purposes? Forget about diamonds being a girl’s best friend, they can be an investor’s best friend as well. Keeping that in mind, read on to discover more…

What are the advantages of buying diamonds for investment?

  • Alternative to gold – Gold is on the decline when compared with the peak it reached the year before, and thus a lot of investors are looking for different commodities. 
  • Outperformed equities – Research shows that diamonds outperformed equities during the first ten years of this century.
  • Worldwide convertibility – Aside from gold, diamonds are the only other alternative currency that is internationally accepted and keeps the exact same value all over the world.  
  • Not tied to fluctuations – Diamonds are ideal for those who are looking for a valuable commodity that is not tied to fluctuations experienced in global bond and equity markets.  
  • No depreciation of value – A lot of luxury items lose their value over time. However, this does not happen with diamonds. This is why a diamond ring is likely to be worth just as much twenty years down the line as it is now. 
  • Protection against inflation – A lot of advocates state that this type of investment presents a hedge against inflation. 

What qualities are used to grade investment diamonds? 

When investing in anything you need to make sure your money is being spent on something worthwhile. To determine the level of quality of a diamond you should look at the following four qualities… 

  • Cut – Cut relates to the diamond’s proportions. The better the cut, the better the diamond’s sparkle. The cut is graded as follows, Excellent, Very Good, Good, Fair, and Poor. Try this James Allen review for a jeweler that gives you several cuts to choose from. 
  • Carat – This relates to the weight of the diamond. Bigger diamonds are rarer and therefore they are more desirable and consequently more expensive. 
  • Clarity – The clarity of the diamond relates to how impaired it is. Clarity is rated from F (Flawless) to I (Included). 
  • Colour – The more colorless a diamond is, the most desirable it is deemed to be. Colour is rated from D to Z, with D representing no color and thus being the most desirable. 

Why should you invest in coloured diamonds?

Last but not least, you may want to consider investing in coloured diamonds. The following points explain the advantages of doing so…

  • Long-term growth – There is only one place to start, and this is the fact that colored diamonds have only moved in one direction since the general public has traded them, and that direction is of course up. 
  • Well-established – Coloured diamonds are traded on an international basis. They have an impressive history, having been collected by the rich and royals for years and years now. 
  • High durability – Diamonds are extremely durable and because of this, their value is very unlikely to decrease. 

Beautiful jewelry – Finally, aside from considering the investment opportunities, you should also contemplate the fact that colored diamonds work excellently for the adornment.

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