Knowledge Is Required When Investing In Diamonds

By Daniel Chapman

Fancy blue diamonds have become much more valuable within the last four decades. In fact, they are 100 per cent more valuable. The ones named fancy pink double in cost in seven year increments. The same is true of the fancy yellow stones. Investing in Diamonds seems to follow trends in jewelry. These colored gems have become better investments than their clear counterparts.

Prices are apparently dependent on changes in the economy. Prices may rise and fall, but when it comes to the colored variety, they rise but do not fall. The colored ones are especially difficult to find for sale. Their rarity pushes the price higher and higher. But, that is not the only reason.

The interest is partially due to the fact that the majority of countries do not impose a rule that their value be reported and taxed. Plus they do not take up much space to keep over time. They are always easy to carry for sales purposes. Colored ones are often hoarded by the jewelers who are not interested in selling them.

To exemplify their rarity, when 10,000 carats of diamonds are mined, the portion that are colored make up one per cent. The chocolate stones are quite popular at this time. The colors that are most rare are the red, green, violet and blue.

There are two ways to invest. The investor can buy stock in a company that mines them. Alternatively, he or she can buy the actual gem stones. Colored ones are not always available, however. Their exceptional beauty for the purpose of making jewelry makes them high cost and hard to find.

As is true with many investments there are some drawbacks. If you have a need to liquidate assets, they are not something you can sell quickly. An expert must evaluate their worth before they are ready to sell.

While gold and silver can be quickly sold because the price is fixed depending on weight, there are many other factors besides carats that the price of a diamond is dependent on. One stone might be clearer or brighter than another. Only an expert, mainly a jeweler, can correctly identify the value of one of these precious gems.

Value depends on multiple factors. Different values can be placed on two gems of the same carat weight. It is not like selling silver or gold where the price fluctuates, but remains stable according to weight. Weight and size are not the only features that fluctuate from stone to stone.

The community of jewelers have long wanted to create a method of pricing diamonds. That would make it easier to popularize investing in Diamonds. But, there are too many qualities that depend on subjective evaluation to make it feasible. There is a vast difference between a fine stone used to make jewelry and a low grade one used to make a glass cutting tool.

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