Diamonds have been a symbol of love and loyalty for centuries, but also of status and wealth. This is how it has managed to build up an extraordinarily intrinsic value right across the world for the past hundreds of years. The raw material became the popular investment asset it is today, especially in times of economic stagnation or low growth.
Most people think investing in diamonds is only reserved for the richest among us. However, you certainly do not need to have millions at your disposal to profitably invest in diamonds. A total of €5000 is already sufficient for the smallest investment. And an amount of €75,000 will give you quite a bit of scope within the diamond market. Plus you will be able to realise a much better return with a valuable raw material compared to the historically low interest rates offered by a savings account.
The 2018 economic crisis served as proof: the diamond market firmly stood its ground whilst listening to the loud moans from the financial markets. However, the diamond remained unnoticed as a smart investment for a long time. The lack of price transparency, the liquid market and the lack of a uniform quality standard which caused this are now a thing of the past.
The market became a great deal more transparent, investment funds in diamonds are becoming ever more popular and the demand for rough and cut diamonds is continuing to increase worldwide. The limited number of new diamond mines and the constantly growing demand means profitability is continuing to rise. Experts from the American analysis agency Wealth-X have noted that De Beers recorded an increase in demand of more than $175 million between 2016 and 2017. The booming popularity of the diamond in the East and the increasing demand for diamonds amongst millennials have played a particularly major role here.
Reports about the increasingly higher auction prices certainly also received plenty of media attention and new investors.
Investing in diamonds is therefore also a valid and reliable alternative to non-millionaires. However, investors need to take the following four basic principles into account: price transparency, quality assurance, transaction costs and liquidity. After all, it is important to realise how these factors can influence your investment.
What if I want to start investing in diamonds straight away? How do I choose the right diamond for my investment? Obtain advice from BNT Diamonds’ diamond experts or request a quotation now.
