An Investment Gem?May 2, 2012
Most women don’t look at their engagement rings as an investment – at least not in monetary terms – but diamonds represent tangible, portable assets which offer a great opportunity to protect an owner’s wealth. Since 2009 the price of diamonds has been on the rise, and while cynics may point to this trend as rebound from the 2008 crash, even after recovering diamond prices have continued to climb.
Salim Hasbani of Hasbani UK and Tresor Paris says that the economic downturn has caused wealthier clients to invest in precious commodities and that “the loss of trust in financial institutions made diamonds a more attractive option.” In 2011 the price of diamonds rose up to 30%, a growth trend continuing in 2012 at least in part due to growing demand in the Indian and Chinese markets.
Those looking to invest in diamonds should be aware of current diamond trends, and be careful with the stones they select. Although many claim that diamonds are inherently valuable, this is of course nonsense – nothing is inherently valuable. Value depends largely on context, and contexts change.
For example, in today’s market the most desireable stones are fancy coloured diamonds, particularly those in blue and pink. However, only 100 years ago coloured diamonds were considered mere curiousities and certainly did not exceed the value of colourless diamonds in the way that they do today.
Expert investors spread their risk through various investment products so that they can provide more stability and growth. The same should apply to diamond investments. Those serious about diamond investment should hold a varied portfolio that includes a variety of diamond sizes and qualities, both in the white and natural coloured families.
Regardless of their cut, colour, or clarity, however, for the foreseeable future people’s love of diamonds seems to be as durable as the gems themselves.