Finding reliable investment opportunities is crucial in such a diverse economy where prices can change instantly. With inflation going on around the world, you just don’t know what to expect in the future. Thus, you have to change your money mindset for the better to thrive. Know that the money in your bank or stocks can get affected when the stock market collapses. That said, it’s better to hold physical commodities in your hand, like precious stones such as diamonds.
Over the past few years, there has been an increase in interest in investing in diamonds. It’s seen as a viable investment opportunity by individuals and professionals. But what do you think makes diamonds a good investment?
Diamonds As An Investment
Diamonds are one of the most precious and sought-after gems in the world. They dazzle with sparkles and beauty while being a great addition to almost anything, such as jewelry. While buying diamonds for the purpose of wearing them is usual, many interested people are now beginning to regard diamonds as a feasible investment choice. Here are some of the top reasons why:
A Store of Value
An asset’s value is determined based on its supply and demand. The fact that diamonds are already rare and keep increasing in demand year after year—makes them a good investment. And with most diamond mines closing recently, diamonds will eventually become even more scarce like any natural resource, which affects the long-term increase in the value of diamonds.
Another thing is that diamonds may come in a wide range of colors, depending on the type of impurities present in the stone, ranging from classic clear to yellow, orange, blue, and even black. Fancy Intense Violet is one color that is so uncommon that most businesses will never truly see it in its shade. This rarity adds more to the value of the diamond.
Ability To Retain Value
Diamonds, like most physical commodities, provide price stability in times of economic decline. It is because their value depends on their intrinsic value rather than their monetary value. This means that their value does not fluctuate with the economy.
Additionally, diamonds are a finite resource. As the demand increases, so does their value. It makes them an excellent choice for those looking for safe investment in uncertain times.
Another reason why diamonds are such a great investment is that they’re durable. In fact, they’re known to be the hardest natural mineral on earth. Made up of crystallized carbon, diamonds are ready for wear and tear. You will see no fade or tarnish as time goes by. And with proper care, they can even last forever. You can pass them down to family heirlooms and increase their sentimental value.
Storability And Portability
Knowing how precious diamonds are is already astounding. But diamonds, being such a small item that can be worth so much money, make them an even more excellent investment choice. You can easily store them in the smallest of safes. In addition, you can bring them with you anywhere you want to go to keep them in sight. And the fact that you can look at them, hold them, and even wear them makes them feel safer than stocks and other financial items.
Diamonds have been used by royalty for trade and exchange for hundreds of years. And until now, they are still recognized and accepted as a global currency, with their value increasing in a steady upward trend. If you can create the right portfolio with mined or lab-grown diamonds, you’ll reap great benefits from them in the long run. Just make sure they’re professionally certified by the Gemological Institute of America (GIA) to know if they really do hold value.
Diamonds don’t wear off. Instead of just storing them at home, you should set them in a piece of jewelry and wear them while using them for investment purposes. You don’t need to worry because doing won’t detract from the value in any way. Plus, you’ll enjoy the luxurious pleasure it provides while you still have it. And if you want to repurpose it, you can take it to a professional jeweler, have it melted down, and make it into something new with a different diamond shape.
With everything mentioned above, we can say that diamonds are a really great investment option. However, just like any other investment, there are things you should consider. One is the risks, such as the lack of tradability and price transparency. Because, unlike gold and silver, diamonds do not have a price index to follow. Its price is determined by its quality/rarity and the market supply and demand.
The best way to overcome the risks is by doing extensive research to know what you’ll face when you go this way. Learn the basics, including the four Cs: Clarity, Cut, Carat, and Color. Set a budget, compare prices with various retailers, and only buy GIA-certified diamonds. These guidelines can help you make better investment decisions.
Moreover, ensure that your diamond investment will only make up a small portion of your investment portfolio. Doing this can lower the risks that come along with investing in diamonds.
Stay ahead of your game by knowing all the advantages, cons, and guidelines of investing in diamonds.
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