In the simple fact in relation to diamonds as an investment, it had been indicated that a carefully picked even bigger, high-quality diamonds in your cathedral engagement rings could generate a financial return on investment. The key reason why then does the jewelry market not even boost diamond jewelry as investment vehicles?
Over time, diamonds in solitaire engagement rings have not been taken as famous investments because of (1) minimal liquidity caused by deficiency of a proficient investing market place (2) not being able to study the quality of human real diamonds and their amazing value/price, and even (3) they had to be acquired from retail shops. Practical purchasers will never purchase expensive diamonds at the high costs required in a retail shop at a cost that may or may not reveal their true level of quality and then sell diamonds back to the retailer at a essential low cost, if forced to do so. That is simply not an efficient market and why most consumers buy diamonds only for special occasions and long-term enjoyment.
Bella Ideale Describes More info on the Wall Street Impression
In the late 1970s and early 1980s, certain high quality diamonds were purchased as investments, because Wall Street investment firms sponsored their purchase and commercial banks supported trading by making loans for investment. Inflation was high in the US at the time and investors were eagerly seeking ways to beat the high cost of inflation via the purchase of undervalued assets.
According to bidiamonds.com, Wall Street professionals believed they had mitigated the historic concerns mentioned above by creating an active market for diamonds and by getting diamonds certified as to quality by independent gemological grading laboratories. Professional, objective grading allowed market action to establish appropriate pricing/values for diamonds. Professionals in the diamond trade did little to discourage investment, because, like Wall Street, they were making big money by the trading activity.
Everyone was happy until speculation drove the pricing of a high quality, one carat, certified diamond in his or her cathedral engagement rings from approximately $20,000 to over $60,000 before subsequently plummeting to $15,000. When the diamond “bubble” burst, a huge amount of money was lost. It was not a happy time for investors and diamond professionals.
Chagrined and embarrassed diamond professionals tried to re-establish credibility in diamonds with advertising campaigns that promoted a mantra that diamonds should be purchased for special occasions and long-term enjoyment. Even today, the diamond industry remains dedicated to the same theme and remains sensitive to discussions about diamonds as investments.
Returning to Current Times
Things have changed in recent years with the advent of several new international diamond exchanges and on-line trading venues. The Internet venues provide a market for certified diamonds in the most lovable solitaire engagement rings - those that have been graded for quality, according to specific, well-defined criteria, by independent grading laboratories, such as the highly regarded Gemological Institute of America and American Gem Society Laboratories. An identifying number is often laser engraved on the girdle of the diamond so that the grading certificate and diamond are not separated.
The availability of thousands of graded diamonds on-line from the reputed companies like Bella Ideale and in exchanges has helped define the trading range of wholesale prices for specific grades of diamonds, thereby allowing investors and consumer's better transparency of diamond prices. Similar to other stock or commodity exchanges, investors need professional help to access the exchanges and on-line venues to get accurate information. These venues are currently not as efficient as other longer established commodity exchanges, but they do exist and should improve with time.
To discover a little more about round diamond rings, diamond rings, platinum engagement rings, wedding rings, cathedral engagement rings, wedding bands, in addition to other diamond jewelry products go ahead and check out http://www.bidiamonds.com or perhaps click on BiDiamonds.com
Article Source: http://www.bidiamonds.com/blog/opinions-of-jewelry-industry-on-diamonds-as-investment
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