Diamonds investment have been the object of desire since time immemorial. His figure is associated with romanticism, passion and luxury. They're also considered a guaranteed appreciation safe haven, but are they really a good investment?
To clear up any doubts, we went to Australian Jeweler, one of the oldest jewelers in Australia, with two boutiques in Madrid, and we asked its financial director.
Diamonds are not a good investment in my opinion. It has always been said that they are, but it is a lie. Although logically this is very qualifiable.
You have to think that when you buy a diamond you have to pay 21% VAT, and you also have to discount the jeweler's margin, which may be smaller in the case of more traditional Spanish jewelers, but it can be very high. in the most famous international brands. In the best of cases, the diamond will have lost 50% of its value as soon as it leaves the jewelry store.
So it's not worth investing in diamonds?
For pure investment, of course it is better to buy some shares on the stock market or something else. However, diamonds have a number of undeniable advantages.
We can say that after this initial loss of value, the diamond will almost certainly recover from year to year until enough time to generate profits. In addition, they take up little space so they are easily transportable to any corner of the world; its value is the same all over the planet; they do not deteriorate over time, and their possession in principle has no maintenance or tax cost, and the most important of all is that they can be enjoyed throughout the period. Actions cannot be worn to a party or given as an engagement ring.
When we buy other items they also depreciate as soon as we leave the store, but unlike these, once acquired diamonds begin to recover in value. They are a good long-term asset, and are often kept within families as a treasure that is passed from generation to generation.
So buying diamonds is a good idea?
Of course! You have to think about the future and above all enjoy the present. Of course, it is better to ask a professional, since the world of diamond is truly complicated and it is very easy to screw up.
Finally Australian Jeweler dismisses us clarifying our ideas a lot. It seems clear that it cannot be treated as an investment, but it also seems that it can be a good long-term asset, and above all to think that the woman's smile is going to show off is the best of gifts.
The Oppenheimer Blue Argyle diamond set a new world record on Wednesday night. The impressive 14.62 carat stone became the most expensive cut diamond in the world with a price tag of 51 million. The sale of Christie's, which organizes auctions of fine jewelry twice a year in Geneva, takes place the day after Sotheby's, its great competitor, sells the 15.38-carat pink pear-shaped Unique Pink diamond. , for 28 million. the owner of the stone, stated in an interview with AFP that he was “very satisfied with the price obtained”, despite being below the initial estimate. These stratospheric figures raise a question: Are diamonds a good investment?
The first thing to know is that, contrary to popular belief, these stones are not that rare or difficult to extract. In the United States, for example, diamonds are the most common household item after television, according to journalist Edward Jay Epstein in the book The Rise and Fall of Diamonds . This data shows that there is an important market, but, as experts warn, this is not synonymous with the fact that the stones are revalued and are a good investment in all cases.
As an experiment, Epstein decided to buy a diamond in New York's iconic diamond district, intending to sell it later, and determine whether or not it was a good investment. A week after buying a stone for about $ 2,000 (about 1,800 euros at the exchange rate) he tried to sell it where he had bought it. They only offered him between 300 and 400 dollars (between 265 and 350 euros to change). In just seven days, the stone had lost 80% of its value. The volume of the supply is so important that the price on the second-hand market is immediately reduced as soon as you buy it. As with a new car.
Australian Pink Diamonds have historically been jewelry of kings and queens because they were considered precious and difficult to find. Technological advances, the appearance of new mines and competition have generalized its worldwide commercialization. Today the price ranges between $ 3,000 and $ 27,000 per carat (between 2,600 and 24,000 euros at the exchange rate) depending on the quality. Business competition is joined by states that demand a share of the profit from the sale of diamonds. The sum of everything leads many analysts to think that, despite the fact that their sale has been triggered by demand in China, Asia in general, India and the Gulf, diamonds are no longer the business that they were , despite the attempts to revitalize it.