Posted: 10/19/2011 5:53:31 AM EDT
| What about buying diamonds as a store of value? They would be easier to store and transport than large amounts of gold and silver. Anyone do this? Do they hold value like gold and silver? Obviously, you would have to educate yourself about diamonds so you know what you are looking at and what they are worth but I am assuming that couldn't be too hard. |
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Gold a silver hold value because they are a precious metal....with primary focus on the PRECIOUS part. There is a finite amount of gold and silver on this planet, there will never be more, we cant make gold and silver.
We can however make diamonds, most industrial diamonds today are manufactured. Diamonds are be created in the earths crust as we speak. There is huge demand for gold and silver and most mines cant keep up with the demand. Diamonds however are mined, and end up sitting in vaults at Da Beers held from the market inorder to create a small supply and keep the price of diamonds high. Many peoeple believe that if Da Beers released their entire stock it would drop the price to a thousandth of what it is now. Plus with all the fake diamonds it is very hard to trade them. Silver and gold on the other hand is easily recognizable, hard to fake and has been used as currency since the begining of civilization. |
No diamonds. It is an artificial market sustained by the diamond cartels. I had a real estate instructor whose two aunts bought diamonds prior to the Great Depression ('31). When it hit, they went to their safety deposit box and got some out to cash in. No one would buy them and it was explained that the cut was obsolete.
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Diamonds would be more portable, but one must find a buyer.
therefore, I vote: not for me. Given the general knowledge about PMs, I would suspect that stones would be harder to liquidate. Don't forget the 4Cs. then, investment-grades start from: > one carat, brilliant round, VS+, near colorless. also, don't carry in a bag like they do in Hollywood. diamonds do scratch YMMV |
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Investing in diamonds is not a good idea unless you have an outlet to get rid of them. If you went to a jeweler in your home town and bought a $10,000 diamond, and then came into my jewelry store to sell it, I might give you $5000 for it, and that is as much as anyone else would give you for it. That isn't an investment.
Don't forget the 4Cs.
then, investment-grades start from: > one carat, brilliant round, VS+, near colorless This has a lot to do with a diamonds value, but isn't anywhere near the whole picture. You can still see a huge price difference in stones with the same color, clarity, and carat weight. Cut makes a big determination in price and is the most difficult aspect for anyone to understand. That isn't the end of it either, type and location of inclusions, blemishes, flourescence and other factors also influence cost. |
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Diamonds are a suckers bet. Too many variables. Color, cut, clarity, and size. Also they typically are
already 400% overpriced. As previous posts have stated, there is no shortage of diamonds. The price is held up by controlling the supply chain (aka diamond cartels and jewelry stores). I would stick with gold and silver. |
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Market prices, reference for dealers (need subscription)
Rap report Retail price reference, loose diamonds ETA retail link |
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Quoted:
Those are retail prices. RAP claims to be wholesale but their prices are way out of touch with reality. Also, diamonds are not considered semi-precious stones. Actually "semi-precious" is a term that is almost never heard in the industry anymore. your post very useful. please enlighten us with your market which is in touch with reality. |
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RAP (Rappaport) used to be, I assume, at some point in the distant past, an accurate judge of wholesale diamond prices. Since I've been in the business (15yrs) RAP has varied from subtract approx 25% to 50% for real wholesale prices. A few years ago I stopped looking at RAP when I was trying to find a diamond for a customer and looked at RAP for an approx. price then called my wholesalers to find the price less than half of RAP.
If you want a real world price on a diamond find a jeweler that you can trust, not the internet. There are occasional deals out there for the consumer, and you won't find them on bluenile. If you know what you want you can PM me for a price. If you want to buy diamonds as an investment you have to buy them at wholesale. Margins for jewelers have fallen off on diamonds over the past 20 years. Jewelry is not the luxury that it once was. You can't buy a diamond at retail today and expect to sell it at retail ten years from now and make a profit. If you decide to get a tax number, JCK rating and a solid knowledge of how diamonds are valued then you will have what you need to start buying wholesale and selling to the public. |