CAR Grappling with Modernity and Transparency in Diamond Sector

The Central African Republic was banned from exporting diamonds in 2013 after a coup overthrew the...

June 19th, 2018

Challenges Facing the Botswana Diamond Industry

The Botswana diamond industry is crucial to the country's economic health, but with gem sales slumping...

June 19th, 2018

Angola Set to Change Diamond Industry to Attract Investment

In an effort to woo potential investors and offset economic hardship caused by falling oil prices,...

June 7th, 2018

Resource Forecast – Expert Opinions Covering Precious Metals, Energy, Critical Metals, and More

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Alluvial Mining: Gold, Diamonds and Platinum

What exactly is alluvial mining? Put simply, it's the mining of stream bed deposits (also known...

June 7th, 2018

De Beers Launches Fashion Jewelry Line with Lab-grown Diamonds

De Beers coined the slogan "a diamond is forever," but now the mega diamond miner is...

May 29th, 2018

Peregrine Diamonds’ New PEA Increases Chidliak NPV to C$679...

Chidliak's NPV is up over C$200 million from a 2016 PEA, while its life-of-mine diamond production...

May 24th, 2018

Lucapa Recovers 25-carat Yellow Diamond in Lesotho

Lucapa Diamond Company has made its first substantial discovery at the Mothae kimberlite mine in Lesotho.

May 22nd, 2018
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Buying diamond jewelry is a common practise, but buying diamonds and trying to turn a profit isn’t an endeavor most investors undertake. That’s largely because diamond investing is a little bit tricky, especially for those used to investing in precious or base metals, whose prices move more predictably. For one thing, unlike metals like gold and silver, diamonds are valued subjectively; there is no simple cost-per-ounce valuation system for them, so investors can be left wondering whether different appraisers will assign their diamond the same value. Colored diamonds, which are rising in popularity, only complicate that issue. Connected to valuation is the problem of selling a diamond. Most diamonds are sold through retail stores at very high profit margins —...

Buying diamond jewelry is a common practise, but buying diamonds and trying to turn a profit isn’t an endeavor most investors undertake.

That’s largely because diamond investing is a little bit tricky, especially for those used to investing in precious or base metals, whose prices move more predictably. For one thing, unlike metals like gold and silver, diamonds are valued subjectively; there is no simple cost-per-ounce valuation system for them, so investors can be left wondering whether different appraisers will assign their diamond the same value.

Colored diamonds, which are rising in popularity, only complicate that issue.

Connected to valuation is the problem of selling a diamond. Most diamonds are sold through retail stores at very high profit margins — in other words, an investor looking to profit from selling a diamond necklace or other jewelry would like suffer an enormous loss.

Those issues dissuade many investors from getting involved in the diamond space, but they are by no means unsolvable. Generally the trap market participants fall into is thinking that every diamond can be considered an investment; however, as industry experts have pointed out, that’s simply not true.

So what types of diamonds are considered investment quality? Interestingly, most white diamonds do not fall into that category. That’s because about 98 percent of all diamonds are of the white variety, meaning they are not that rare. Essentially, while some can be a valuable investment, to do so they must be amongst the largest and highest quality.

Many involved in the diamond space are instead looking to opportunities in the colored diamond space. Only around 2 percent of all diamonds are colored, meaning that they are very rare.

Colored diamonds come in a myriad of colors, with red and blue being among the rarest and most pricy. Yellow diamonds fall on the more affordable end of the spectrum, and brown diamonds are cheaper still. For investors looking for an entry point to the diamond market, they may be options to consider.

All that said, buying physical diamonds is by no means the only way to gain a foothold in the diamond market. Investing in diamond stocks is also a possibility, though doing so requires some careful thinking. That’s because diamond exploration is costly compared to exploration for other resources, and in today’s tough markets companies are receiving little funding.

In terms of pricing, diamonds did not fare very well in the first half of 2015. However, hope remains amongst industry experts. John Kaiser of Kaiser Research said recently that he’s looking longer term for improvement, noting, “long term, if you’re optimistic about global GDP growth and believe that, say, 2020 and beyond India is going to finally get traction and start to imitate what China accomplished in the last 15 years, you’re going to see again expanding wealth and prosperity in the world.”

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