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Is Buying Diamond Jewellery A Good Investment?

Is purchasing a diamond jewellery a good investment? If you ask this question to anyone from the past generations, then you might probably get a frowned face from them. But that’s not their fault as they have always seen and heard that it is unwise to invest money in any jewellery other than gold. In India, for a long period of time, yellow gold has held the highest rank of purity. Hence, it has been believed to be the best investment option. They believe that any stone-studded jewellery like diamond or gem-studded ornaments is a bad investment as such type of ornaments are usually crafted in low-quality gold like 14 Karat or 18 Karat.

The good news is, today, times have changed. If you are willing to invest in diamonds, then don’t get demotivated. You can make diamond jewellery a part of your investment portfolio as diamond jewellery can get a good return on investment if invested wisely. It is observed over a time that diamonds have shown a steady appreciation in price. Although just like any other form of investment, these too has its pros and cons, that must be learnt well if you have any plans to invest in diamond jewellery.

  • Pros of investing in diamond jewellery 
  1. Compact in size: A lot of people have an issue that the ornaments are difficult to store or organize due to their size. Diamond jewellery is generally dainty and compact, unlike gold bullion. Also, when it comes to cost, a small trinket of a diamond can cost double as compared to the gold jewellery of the same size. This eventually indicates that diamond jewellery, even in small size, makes a profitable investment.
  2. Easy storage: With compact size comes comfortable storage. Dainty and small piece of ornaments can fit anywhere, which makes it easy to store diamond jewellery properly and take good care of it. This is why a lot of people feel investing in diamonds is better than investing in stocks.
  3. Better durability: Diamonds are one of the hardest items found on planet earth. This natural quality of diamonds makes it more durable than other ornaments. Longer durability ensures a long time to enjoy your investment.
  • Cons of investing in diamond jewellery
  1. No price transparency: One of the biggest drawbacks of diamonds is that there is lesser price transparency. Unlike gold, diamonds have no set price index to be followed. Thus, the demand and supply in the market are the only price driving factors for the diamond market.
  2. Lack of tradability – The second drawback of investment in diamond jewellery is that it has a very low tradability rate. This means it is easy to buy diamonds but not that easy to sell them. Even if you find a buyer, then you might receive a very low price than for what you invest.
  3. Benefits only in the long term – A lot of investors nowadays like to invest in options that give quick returns, which are short term investments. Investment in diamond jewellery shows results only over a period of time, which is a big turn off for people who want quick returns.

 

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