Sunday, July 15, 2012

Buy Diamonds for Investment?



Unlike many other valuable commodities, you cannot buy diamonds in the form of shares or an ETF fund, or as a conventional commodity. It has to be bought as is.

Because you can pack lots of value in a tiny item, the diamond can be highly valuable in an emergency for someone who has to leave his country or salvage assets in a dire emergency. But how does it shape up as an investment?

Not very well for a number of reasons. Importantly, quality determination and value require expertise. There is the danger of loss and/or theft. The difference between cost and sales figures can vary greatly because of unestablished markups.

Remember also, diamond supplies have to be controlled for values to be stable on a global level, especially these days when artificial diamonds can be so close to the real thing in appearance and usage. (See the Earl J. Weinreb NewsHole® comments.)

No comments:

Post a Comment