Tips for Purchasing a Diamond for Investment

Love the look of diamonds? Want to invest in diamonds or diamond jewelry? Investing in diamonds can be a valuable asset if done correctly. Across the years, the value of diamonds can increase, depending on the rarity, value, and degree of the diamonds you decide to invest in.

Not everyone is skilled in diamond investment; however, with the right knowledge and skills, you can become one of the few people who have a great investment that may make you thousands of dollars in the near future. However, before rushing in and buying any diamond, here are some basic tips you can use when you want to purchase a diamond for investment purposes.

Diamond Investment Requirements

Before you invest too much in diamonds, you must first make sure that your investment follows some specific requirements. These requirements include:

• Expert Guidance

• Quality Certification

• Market Access

• Resale Liquidity

• Price Transparency

The purchase of an investment diamond needs to be around the price close to what you can resell it for. Buying your diamonds at retail and reselling them at wholesale is a bad decision. This is where your expert can help you gain direct access and knowledge on international markets and dealers.

The quality of your investment diamond needs to be confirmed through a 3^rd party expert on grading. The precise confirmation of the grading is essential to the resale value.

Invest in Basic Diamonds

Although it may be more alluring to invest in the large and expensive diamonds to attract wealthy collectors, this can cause complications, as they don’t offer a timely resale liquidity or price transparency. Unless you have millions in your bank account or you’re an expert collector, try to steer clear of these spectacular diamonds, as they are often harder to sell than basic diamonds.

It is recommended that a good diamond investment includes, but isn’t limited to:

• A round shape

• 1.01 to 1.49 carats

• IF-VS2 clarity

• D-H in color

• An excellent to very good cut.

On a daily basis, these diamonds tend to trade well, and their prices are well-known when it comes to selling and purchasing.

Quality Certification

Investment diamonds should be graded and confirmed by experts in the field.  Having proper certification of quality is the most vital part when it comes to purchasing an investment diamond. Diamonds with certification will have a better resale value than those which don’t.

Transactions Costs and Bid/Ask Spreads

The reasonable transaction costs of investment diamonds involve physical delivery of the diamonds. This can run 2% to 5%, depending on the investment size. Before investing, investors need to investigate the bid/ask spread or the difference in price between the price of buying and of selling investment diamonds. When you’re looking to purchase a diamond for investment purposes, it’s a good idea to see your estimated resale price if you resold it on the same day you purchased it.

Taking Care of Your Investment

When investing in diamonds, you will need to take great care of them to ensure your profit value increases. Always keep your diamonds or diamond jewelry in a sealed, padded jewelry box. Make sure it is locked, to reduce the risk of the diamonds falling out, and place your diamonds in a safe area where you won’t succumb to the allure of constantly touching them.

Keep Track of Your Investment

As the years go on, it’s a good idea to have your diamonds valued by a professional jeweler or gemstone expert. By keeping a track of your investment, you will understand how much of an increase per year your investment is making you.

Selling Your Investment

Selling your investment when you’re ready is like selling any other investment you own. You have to find the right buyers and the right market. When you’re getting close to selling your investment, it’s important to keep a track of the market and the potential buyers you may be selling them to. This could be jewelers or private buyers. Know the market price of diamonds at the time you’re looking to sell, so you know you’re getting your money’s worth for the diamond type you have.

Conclusion

Investing in diamonds can be a great step toward a healthy financial future, although it’s important to do your research to ensure that you aren’t going to lose profit in the long run. Whether you love the look of diamonds, love their value, or just want to try your hand at investing in something different, you won’t be disappointed. So, are you investing in diamonds? Are you considering diamond jewelry?