Are Diamonds a Good Investment?

They are the most coveted jewelry item in the world and are certainly among the most expensive. They're also one of the most beautiful gemstones, but can diamonds really be a good investment? 

Paramount Jewelers has joined the debate to help you settle on an informed conclusion. In this article, we will look at why diamonds are considered by many to be an excellent investment and also examine why they might not be such a great choice as an investment vehicle.

Investing in Diamonds

When most people think of investing in diamonds, they think of buying and holding physical stones. However, diamond investing can take many forms. You can invest in mining companies that extract diamonds from the earth, in diamond-related businesses such as jewelry stores or diamond cutting and polishing companies, or simply buy and hold physical diamonds. Another way to invest in diamonds is by purchasing shares of mining companies through their stock exchange listings. Diamonds are mined out of the ground with machines, so there is no concern about them becoming obsolete due to new technology like other goods made of more perishable materials.

The Advantages of Investing

There are a number of reasons why it is wise to invest in diamonds,

  1. Diamonds are a finite resource, making them a rare commodity compared to other precious stones. This makes them highly valued. 
  2. They are also durable and can withstand wear and tear, which means they will retain their value over time. 
  3. Unlike other investments, such as stocks or bonds, diamonds do not fluctuate in value as much, making them a more stable investment. 
  4. Diamonds are also easy to liquidate and can be sold easily if needed. This is particularly useful in emergencies or times of need.
  5. The value of diamonds is purely based on their quality and size, not their brand or business name. This means that you can trust they will hold their value well over time, unlike other luxury items that are overpriced because of brand names.
  6. Diamonds are easy to care for and do not require extensive maintenance or polishing, meaning they do not require much effort or cost to maintain their value.

The Disadvantages of Investing

Diamonds are less liquid than other investments and can take years to resell at a profit. It is also difficult to track the value of diamonds, so it's hard to know if you're making money or not. Plus, it's hard for those outside the industry (who don't have access to supply and demand data) to know how much profit they could make by buying and selling stones. For these reasons, investing in diamonds should be considered a long-term strategy rather than an opportunity for quick profits. 

Final Thoughts

While diamonds are actually a good investment, it is important to remember that their value can fluctuate greatly. Therefore, you should only invest in diamonds if you are comfortable with the risks and can afford any potential losses. 

Paramount Jewelers is a great place to start your search for the perfect diamond. Our experts can help you find the best quality diamond at the best price. We have a wide selection of loose diamonds and certified pre-set rings. We also offer free appraisals on all of our items, so you know what something is worth before you buy it! 

Contact us today for more information about investing in diamonds or anything related to jewelry. We would love to answer any questions you may have!