Investing in Diamonds as a Tangible Asset

When it comes to investment, people usually think of stocks, real estate, and bonds. However, there’s another asset class that’s gaining popularity among investors: diamonds. Investing in diamonds as a tangible asset has many advantages, including their durability, rarity, and portability. In this blog post, we’ll dive into the details of investing in diamonds and what you need to know before you take the plunge.

Why Invest in Diamonds?

One of the primary reasons people invest in diamonds is their ability to retain value. Unlike other assets that can depreciate or become obsolete, diamonds have maintained their worth over time. They are also considered a hedge against inflation since their value tends to rise with the cost of living.

Another reason to invest in diamonds is their rarity. Natural Diamonds are formed deep in the Earth’s mantle and are difficult to mine. As a result, the supply of diamonds are limited, which drives up their value. Diamonds are also a portable and tangible asset, making them easy to transport and store. In addition to an investment you can always set your investment grade diamonds in a ring, pendant or earring setting and enjoy wearing them until you want to liquidate.

Types of Diamonds to Invest In

When it comes to investing in diamonds, there are a few different types to consider.

Here are the most common:

Loose Diamonds: These are diamonds that are not set in jewelry. They are the easiest to trade, as their value is based solely on their characteristics (the 4 Cs: carat weight, cut, color, and clarity).

Fancy Colored Diamonds: These are diamonds that have a natural color, such as pink, blue, or fancy intense yellow. They are rarer than colorless diamonds and can command a much higher price.

Investment-Grade Diamonds: These are diamonds that meet certain criteria, such as being over a certain carat weight and having a high color and clarity grade. They are considered the most desirable for investment purposes.

Things to Consider When Investing in Diamonds

While diamonds can be a lucrative investment, there are a few things to keep in mind before you start:

Diamond Grading: When purchasing physical diamonds, it’s important to understand the 4 Cs and how they impact a diamond’s value. You’ll want to ensure that any diamonds you purchase have been graded by a reputable diamond grading laboratory, such as the GIA.

Storage and Security: If you choose to invest in diamonds, you’ll need to consider storage and security. You’ll want to store your diamonds in a safe location, such as a safety deposit box in a bank or a home safe.

Investing in diamonds as a tangible asset can be a smart way to diversify your investment portfolio. It is best to contact a reputable firm and expert to go over all your options. 

Ed Butowsky Is the managing partner of Chapwood Investments and will give you a free consultation on diversifying your assets. 

Ed Butowsky

Managing Partner

Chapwood Investments,LLC

Member SEC, SiPC / Member FINRA

(o)    972.865.2223

(m)  972.897.0197

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