An increasing number of investors are going for the investing in diamonds or gold option in times of crisis. These raw materials never lose their intrinsic value and are therefore a safe choice. But all they all equally stable?
The gold market has been well known as a stable investment for many years, which is particularly valuable during times of crisis. However, gold has lost many of its advantages during recent years. Nowadays the gold market is volatile and difficult to predict. The intrinsic value is in doubt too. In some sectors, such as the jewellery industry, a physical investment in gold can result in some added value. However, the global market value is much lower, particularly for the difficult to liquidate gold bars.
You cannot always be sure of the gold’s high quality. The precious metal is often mixed with other metals, especially with jewellery, making the actual weight difficult to ascertain.
China, India and the Middle East are the ones who have been particularly responsible for lighting the fuse on the demand side of the diamond market. For example, these days 40% of all Chinese city women get married with a diamond engagement ring. Twenty years ago this was 0%. However, the supply side has remained stable, as no new large diamond mines have been added over recent years. Even if one was found tomorrow, the start-up would take at least 10 to 12 years. This combination of factors increases the market prices.
Countries like China, Russia and India have regarded diamonds as a fully-fledged investment for quite some time. Investors in Europe and the United States are now also starting to come out of the woodwork.
Investing in diamonds is a safe investment in a stable market. It is therefore important to consult reliable specialists, who will be able to help you find the ideal investment. A nice budget is also of importance to your portfolio. A €100,000 diamond ring naturally has more investment potential than a €1000 ring. However, this does not mean investment diamonds need to be of the rarest quality or have the highest price tag. After all, rare diamonds would be the hardest to sell. Good quality diamonds are easier to sell and will proportionally increase in value faster than the rarest types.
Which diamond is the right one for me? How do I start the process of investing in diamonds? Ask BNT Diamonds’s diamond experts for advice.
