DIamonds

I am new to investing, and I was recently told that diamonds are unpredictable. I thought diamonds were a constant, but then realized perhaps the whole "blood diamond" issue came into play with this, as well as the conflicts in Africa. Are diamonds worth the investment or not? thanks.

 

Are you talking about investing in individual diamonds, companies that sell them, or mining companies? If its is the former, I know it can be done, but you really need to understand the market before taking the plunge.

 

Thanks.. I should have clarified. Sorry. I was talking about actual personal jewelry. I bought a piece for $2500 from someone who was desperate. It turned out that three different jewelers appraised it at $10,000. I start thinking that if I can do this, with legitimate jewelers appraising, it would not only help me as an investment, but it would help the person who was in need of the cash.

I just did not know if the value of the stones would in fact keep going up.

 

I personally think jewelry (stones and gold) are always a good investment. They are one thing that can always be (re)sold. At the same time, its market value does fluctuate. But look at this way, it's less of a risk. If you were to invest in a company or stocks, you could lose all your money and be left with 0. But with jewelry, as long as you have it in your possession, you'll always have potential money in your hand. A diamond can never be reduced to $0.

 

The risk involved here is if you keep your jewelry at home it can be stolen and you'd still lose all your money. However if you'll find a good place to store the diamonds you intend to sell then I'm sure you can make some good cash from them. Question is, who will you be buying the stuff from? Where do they obtain the diamonds from? Unless you are careful you'd find yourself in serious trouble.

 

Buying diamonds from people that legitimately own them but need the money and are willing to sell at a lower price isn't a bad idea. I mean, there are plenty of risks, and Rainman pointed out a couple of them. I wouldn't deal with individual diamonds myself. It's too risky and seems a little bit annoying to be honest.

 

DO you really think that if you invest in a company that has a high level risk portfolio that you may lose everything? I think that it is possible, but that would be really rare, especially with stocks, you can't lose to "0" with stocks, may be half of an investment, but certainly not all.

 

When it come to Diamonds, it gets kind of complicated, because you have to deal with different types of companies, that deal with diamonds, you just have to do a study of this companies and know which one to invest in.

 

I was told diamonds are almost the most liquid commodity to have. You can supposedly safely sell them anywhere in Europe, South America, and of course North America. If that were true then diamonds would be a less risky investment than oil, or other commodities. Besides Euros, the UK'S Pound, or US Bonds and cash what could be safer?