You may now see potential opportunity in a diamond investment. If you are one those people that had a portfolio consisted of traditional financial products such as shares, we know that you suffered losses during the last financial crisis. Investing in diamonds could be the alternative that you were searching for to safeguard your portfolio from adverse financial developments. By the end of this article, we are certain that you will be looking for more information on this valuable asset.
Polished diamond prices vary widely depending on a diamond’s carat, colour, clarity and cut, sometimes referred to as the 4 Cs. In contrast to precious metals, there is no universal world price per gram for diamonds. The industry refers to price guides such as the Rapaport Diamond Report, the Troy Diamond Report, PriceScope. Global trends are affecting the prices of diamonds. The biggest markets are the United States with about 50% of the market, China and India. Larger diamonds have been better appreciated than smaller ones since 2008.
Selecting the appropriate investment-grade diamond, several factors should be taken into consideration. Among them are:
• Investment grade diamonds become more precious and valuable over time
• Budget of the buyer for guidance to the suitable type of diamond (rarity, ease of liquidity, etc.)
• Buyer has the option of selecting investment-grade diamonds with serial numbers
• Desired duration and purpose of investment
While we have gone beyond the 29 factors affecting the overall value of a gem, the 4C’s are the quintessential metrics when evaluating a diamond, and each investor should understand each of these elements thoroughly. One of the first things that come to mind when discussing a diamond’s worth is its weight in carats. Officially, 1 metric carat equates to 200 milligrams and can be subdivided into 100 “points” allowing for grater measurement precision. The greater the weight of the diamond the higher its price will be.
On the other hand, the quality of coloured diamonds is measured in terms of purity of colour. For example, a pure red diamond with a slightly coloured tint will have a higher value than a black diamond. Sometimes, colour level distinctions can be very subtle and almost invisible to an untrained eye, but they play an important role in assessing the quality and value of the diamond. During their formation diamonds usually acquire internal and external characteristics that define the way they look; these are called “inclusions” and “blemishes” respectfully. In order for a diamond to be deemed “clear,” such characteristics need to be absent. The stones are evaluated by determining the nature, size, position, and number of these impurities. The final of the 4Cs is often mistaken for the shape of the stone, but in fact a diamond’s cut grade defines how well its facets interact with light. This is what adds a distinctive shine and sparkle to diamonds. It’s probably the hardest to evaluate.
Having this information in mind, you are now able to judge if you would like to add an investment in diamonds in your portfolio. Having a diverse portfolio is useful and safeguards your investment strategies so if you are able to give the right amount of money in diamonds, go for it!