Basically, two different classes of gemstones can be distinguished as investments: diamonds and colored stones. Both types of gemstones are characterized by extremely small existing quantities. Worldwide, there are only very small deposits and few mines that extract them. While the trade with diamonds shows a strong standardization, this is not the case with colored gemstones. Accordingly, the effort required by investors to estimate the value of a colored stone is greater.
Colored gemstones that are well suited as investments due to their high demand and a very low available inventory include, in particular:
Emeralds
Rubies
Sapphires
In addition, tourmalines and mandarin garnets are also considered coveted investment properties.
Determining the value of gemstones
The long-term investment in gemstones as a financial investment is only possible for wealthy private investors and only as a portfolio addition. The purchase of a stone makes sense only from a price of several 1,000 or 10,000 euros. Due to the high acquisition costs, the determination of the value by a reliable expert is of great importance. The following criteria play a role in the valuation of gemstones:
Weight
Purity
Cut
Color
If you want to buy a precious diamond, you should make sure that the stone you are considering has a certificate from a recognized organization. The German Diamond Institute as well as the US-American GIA (Gemological Insitute of America) are considered to be the first addresses for the appraisal of diamonds and other gemstones. In addition, the two Belgian institutes HRD (Hooge Raad voor Diamant) and IGI (International Gemological Institute) also enjoy an excellent international reputation as issuers of expert opinions and appraisals. To ensure that gemstones have the highest possible fungibility as an investment, investors should opt for standardized cuts. Gemstones that experts classify as extravagant due to inclusions, unusual colors or similar characteristics also imply the risk of being difficult to sell.
Spreading the risk when investing in gemstones
As with all investments, the principle of spreading risk applies to investing with exness-sg.com/metatrader4/ in gemstones shares. For this reason, investors should never invest all of their assets in colored gemstones or diamonds. Instead, prudent savers minimize the risk of capital loss by spreading their assets across different types of investments. In addition to fixed- or floating-rate savings, a balanced portfolio also includes stocks and other tangible assets, such as real estate.
Acquiring a single, large gemstone is considered equally inadvisable. For reasons of prudence, investors should instead buy multiple, diverse gems. For example, the stable performance of rubies can offset the losses in the listing of diamonds. In addition, if gemstones are too large and precious, there is a risk that finding buyers will be difficult.
Conclusion:
Diamonds, rubies, emeralds, and sapphires represent the top choice for gemstone investment.
In addition to protection against economic crises, this form of investment has other advantages, especially continuous and long-term appreciation.
Investors should only buy gemstones with a certificate issued by a recognized institute.
