When suitable diamonds as an investment?
Diamonds are used not only in the jewelry area, but is also very good as an investment, if you some important things are noticed. If you are interested in the topic of investment diamonds, you find the following 10 helpful information.
1 worldwide increasing demand for diamonds
The demand for diamonds growing steadily. A growth of in demand of between 10-15% there is a year. The largest share of which accounted for the emerging economies of India, China, Russia, Brazil and Mexico, where there are annual growth rates of up to 40%. A new middle – and upper-class, who is interested in the purchase of diamonds is created in these emerging markets. The Arab spring and the debt crisis in Europe have also contributed that rich strata of the population have lost confidence in conventional currencies and in their search for alternative investment opportunities more diamonds opt for.
2. decrease in supply due to the limited natural resources
For diamonds, a decline in the offer faces the increasing demand. The diamond resources of known mines are limited and slowly tilt to its end. The extraordinarily large Ekati mine in Canada is an example; There, the considerable amount of 4.5 to 5 million carats of diamonds is mined each year. Estimates by experts the reserves of this diamond mine will be exploited by the year 2015.
Lately, there have been no discoveries of new, similar to major mines. The production of rough diamonds is already declining: while in 2006, worldwide still 106 million carats were mined diamonds in the year, there were 2010 just 130 million carats.
New natural reserves of diamonds were found on the seabed, however, which is very time-consuming and costly. This is another reason that is assumed by a price increase.
3. diamond prices: historical review of the rise in the price of diamonds
The long-term development of the market value of an Einkaräters shows in color D with the purity IF by the year 1960 to the year 2011, that diamonds never were exposed to a loss in value. In the period between 1960 and 1990, a consistently high rate of growth is increasing, between 1990 and 2000, the growth is somewhat lower. In 2000, the price increase was particularly high.
4. stability of investment diamonds in financial crises
The value of investment diamonds is been far less affected by the financial crisis deep as that of the German stock market securities. While the bonds of the three major companies Siemens, Mercedes and Lufthansa have suffered significant losses, the crisis has impacted much less on investment diamonds. It is expressed only in the form of a pause in the increase in value and not by a loss in value.
Nevertheless, there was a very strong recovery in the equity markets up today (February, 2012). Total can be observed that the prices for diamonds historically although not spectacular, quite steadily and without comparable return-type-setter have increased but compared to shares.
5. advantages of diamonds as an investment
Investment diamonds are characterized by their high concentration of values; as a result, they are easy to store and especially suitable for transport. As a comparison: EUR 1.5 million in diamonds have a weight of 2-50 grams, the same sum in gold weighs approximately 35 kilograms.
Investment diamonds also have the advantage that they enjoy an international acceptance and that there are no reporting requirements for them.
There is also a dual function in the form of investment and gemstone to investment diamonds.
6 disadvantages of diamonds as an investment
An investment in diamonds has not only advantages; One difficulty is that there are diamonds in many different quality levels, which have a different appreciation for example.
Another point is that investment diamonds not suitable for short-term speculation, since they are subject to a relatively slow increase in value.
For individuals who want to buy an investment diamonds, is the problem that there is often a considerable difference between the purchase and sale price. Can thus come to a loss for the private seller because he will score usually only the dealer purchase price in the sale.
7. first considerations for the successful purchase of investment diamonds
Keep in mind that no quick speculative gain can be achieve with diamonds. If you don’t have interest to a longer-term value fuse should be abandoned rather buying of diamonds as a pure investment.
Gain clarity in what sizes and levels of quality you want to invest. This one should consult, if one is not familiar with the area, be sure.
Watch out also for a bargain.
8 rules of thumb for the selection of investment diamonds: cut, carat, certificate
The brilliant cut is suitable, because he has by far the largest spread.
On diamonds, whose Größe is less than 0.25 carat, should rather be avoided.
It is best, if the diamond on a GIA certificate (Gemmological Institute of America) has. Other certification institutes such as HRD and IGI are very trustworthy, but GIA has still the world’s highest level of acceptance, which can facilitate the sale of a diamond.
Security is enhanced, if the diamond with a laser engraving, so easily traceable ensuring that certificate and diamond really belong together.
You have the choice between a larger investment diamonds of lower quality and a price-same smaller, quality diamonds, so you should decide tends to be for the larger diamonds. The price development of the precious stones with a high carat is usually very good.
9. the classic investment diamonds, along with their color and purity
In principle, large diamonds in flawless quality apply (IF, internally flawless) and by high or highest color category as suitable for a valuable investment. One-carat stone in high fine white (D, exceptional white +) are considered classic investment diamonds.
After it but will come according to current forecasts, also to an undersupply of jewelry diamonds in weaker qualities in the next few years, an investment in such can pay off also.
10. do not secure future forecasts possible
The past performance of investment diamonds suggests that there will be further price increases in the future. There are however no warranty; for this It would be theoretically possible that shrinks the market for diamonds. So it was in 2008/2009 for a mild recession in the sale of jewelry diamonds and end 2011 a downturn during the earlier diamond prices skyrocketed.
A future development of diamond prices can and do we submit not binding forecast. As with all assets a historical tendency to notice that we experience as jewelers, which however should be no binding conclusions for the future is diamonds. We are neither called nor entitled to make investment recommendations. We but love to talk to you about our understanding of the diamond market has grown over the years.
For more information on the subject of diamonds as an investment, we recommend our PDF with the most important facts:
Download key facts to investment diamonds