WHAT ARE INVESTMENT-GRADE DIAMONDS?
All investments are subject to the economy and the investment market, as well as supply and demand. However, investment-grade diamonds rarely depreciate. Allocating a small percentage of your investment portfolio to physical diamonds provides greater global security than keeping cash on hand. As less diamonds are being mined, more diamond mines close, and no new mines expected to be started for a decade or more, the reduction in supply and increased demand indicates diamond values will grow further — and possibly faster.
DEFINITION OF INVESTMENT-GRADE DIAMONDS
The world has an abundance of industrial grade diamonds. However, diamonds of investment and jewelry quality are rare. The best investment-grade diamonds are those polished to the highest standard, GIA Triple Excellent and are of the color, size and purity that are globally in demand for engagement rings, making them the most desirable and resalable. When compared to common diamonds, investment-grade diamonds cost slightly more as the quality of cut is more expensive to achieve, and because they are of the types in continual global demand. However, these are the diamonds that see higher appreciation in value over time.
QUALITIES OF INVESTMENT-GRADE DIAMONDS
The quality of diamonds is defined by the four C’s. Cut, Clarity, Color, and Carat weight. Diamonds considered investment-grade are those displaying higher ranges of cut, clarity and color than common diamonds. Liquidity (ease of sale) is also an important aspect of investment-grade diamonds. Diamonds possessing the color size and purity used globally in engagement rings make them the most desirable and liquid, as engagement diamonds represent 50% of global diamond transactions.
CERTIFICATION
Holding a paper certificate of a third-party diamond assessment greatly increases its potential for value appreciation. The certificate provides physical proof that the diamond has been appraised by a reputable and objective laboratory. The laboratories of the Gemological Institute of America (GIA) are the most highly recognized certification organization. In addition to verifying and validating the qualities that determine a diamond’s value, the certificate by detailing blemishes and inclusions, can also help identify a specific diamond in the event of loss or theft.
