Any good financial adviser will tell you that a balanced portfolio is the way to go in order to maintain some level of stability through any economy. This is why it’s always a good idea to have precious metals and gemstones. That said, diamonds and other stones cannot be publicly traded the way you do with stocks and bonds. Investing in diamonds is certainly a worthwhile way to create a strong financial future, but there are a lot of things that you need to know before you consider making them part of your investment strategy.
The first thing to consider is the amount of money that you have to invest. Keep in mind that gemstones are a long-term investment, and therefore not a way to make some quick money. Any money you invest today is going to be tied up for many years to come.
While diamonds are the first thing that come to mind when investing in gemstones, they are not your only option. For the most part, there are massive conglomerates in control of the global trade of diamond. Familiar gems that are no controlled in that way are rubies, emeralds, and sapphires. Lesser known stones that are also available to invest in include the likes of Alexandrite, opals, tsavorite, and South Sea pearls.
Before you invest in diamonds, you should have an understanding of how they are valued. Carat is the weight of the diamond, and is one of the 4 C’s, the other three of which are Clarity, Cut, and Color. Diamonds that are beautifully cut and visibly yellow are valuable, but not worth as much as flawless, heavier diamonds that are blue white. You could potentially be looking at a difference of $50,000 in a diamonds of the same weight.
While blue white diamonds are among the most valuable, there are exceptions, which would be the colored diamonds referred to as fancies, which are rarer than white diamonds. Even though it was only 5 carats, the Moussaieff Red Diamond sold for $7 million. Some of the colors you will find in fancy diamonds are blue, pink, violet, green, and vibrant bright yellow.
In valuing colored gemstones, the rarity of the stone, as well as the depth of the color, carat, clarity, and cut, are taken into consideration. Rubies are about 1000X more valuable per carat than amethyst. One common mistake that is made is to believe that color tells you what the stone is. Many people would identify a blue stone as a sapphire, but it could also be a beryl, topaz, zircon, spinel, or iolite, which are all valued differently. Sapphires also come in a wide variety of colors other than blue.
When purchasing gemstones, always go with a reputable dealer. You are going to find all sorts of individuals selling stones online, but there is a distinct possibility of being ripped off, unless of course you are a certified gemologist trained to value stones.
Once you own the gems, keep them locked up somewhere safe., with a safety deposit box in a bank being your best option. Gemstones are small and can easily fit in your pocket, which is a lot of money to be carrying around. Gemstones removed from a piece of jewelry become much more difficult to identify, so leave them as is if you can.
Buying at retail price is not a good investment, so skip the jewelry stores and look for loose gems at wholesale prices when you invest.