Investing in diamond jewelry doesn’t have to be just for experienced investors and collectors. These days, more and more people are looking for ways to preserve and grow their wealth beyond traditional stocks and real estate investments. Because of their beauty and durability, diamonds have a lasting value that is respected across cultures and throughout history.
What are the benefits of investing in diamonds?
Unlike most other commodities, gold jewelry with diamonds can be a great way to combine a potential investment with something that also holds sentimental value. You can give diamond jewelry to a loved one for an important life event or view it as a family heirloom, something to be passed down to future generations. Moreover, if you happily wear it with love, this enhances its value even more.
Looking back through history, the value of diamonds has been relatively stable but natural diamonds are a limited resource that is increasingly scarce these days. What’s more, they represent an easily transportable form of wealth, unlike, say, real estate. So if you ever had to leave your home quickly in some kind of crisis, you could also easily take them with you.
What to watch out for?
Although diamonds may seem like an attractive investment, there are some risks that you need to consider. Not every piece of diamond jewelry or diamond gemstone is automatically a good investment. You should certainly avoid investing in diamond jewelry or stones if you’re looking for big returns over a short-term time frame.
You also need to consider what is included in the price of the jewelry itself. This is the cost of producing the jewelry as well as other factors (such as the cost of materials) and all of these must be taken into account and included in the cost. If you ever decide to sell your jewelry, you need to be aware that you may not be able to easily recoup your investment.
The value of diamonds
It’s a good idea to have at least a basic understanding of the industry before embarking on any investment in it. The value of diamonds on international markets follows a standardized system known as the 4Cs and the individual parameters which are assessed and make up the 4Cs are carat (the weight of the diamond), clarity, cut, and color. The most valuable diamonds are those that are completely colorless, perfectly cut and with minimal visible inclusions. But sometimes even a smaller diamond can be a good investment if it excels in all the other parameters.
Fancy diamonds (which are rare color diamonds that can be even more valuable than the classic colorless ones) make up their own special category. When it comes to jewelry with fancy diamonds, it’s important to buy from a reliable and reputable dealer who will give you expert advice along with a certificate of authenticity with all the necessary information about the quality and origin of the stones.
What kind of jewelry is worth investing in
Thinking about buying your first piece of investment jewelry but don’t know where to start and what criteria you should use to assess the jewelry? There are several options, depending on your experience, personal preferences and whether you want to wear the jewelry yourself. The following types of jewelry in particular would make attractive choices:
- Timeless pieces–diamond stud earrings, solitaire rings or tennis bracelets will never go out of fashion and will always be in demand. With these, you would likely not need to wait for a buyer for long if you decided to sell.
- Designer jewelry–pieces from well-regarded jewelers or renowned brands, especially limited editions and originals can increase in value over time.
- Old and antique jewelry–these pieces not only have material value, but also a historical one as well. For example, those from the Art Deco period are sought after by collectors, especially if they are well crafted and undamaged.
- Certified diamonds–you could also invest in loose diamonds that have been certified by recognized institutions (such as the GIA). The advantage to such an investment would be zero production costs and the option of having them set into a piece of jewelry with your own design.
Before you buy your first investment piece, decide how to keep it safe from getting lost or stolen. Jewelry should ideally be kept in a safe or a bank safe deposit box. If you plan on wearing it, be sure to check the setting on the stones regularly and to also do regular maintenance and cleaning on the jewelry in order to prevent damage. And don’t forget about jewelry insurance to protect you from any unforeseen circumstances.
