Diamonds vs gold





Diamonds vs gold

Commodities are referred to as an alternative investment category. Especially diamonds and gold are often subjects of a comparative analysis by potential investors. We summarize here the most important differences between both natural resources:

Gold

Diamonds

Safe haven

medium

high

CAGR* (1985 - 2010)

8.9%

10% for 3 Ct

Long term volatility

high

low

Weight for same value**

150 gr

0.2 gr for 1 Ct

Transportability

low

high

Tangibility

medium

high

Estetic/emotional value

medium

high

Certified

yes

yes

Market

public

private

*Compounded Annual Growth Rate
**Based on 1oz gold price and 1ct diamond price, Jan 2013
Although diamonds and gold appear together in jewellery, the valuation of these 2 resources is completely different. These differences can be best explained by the fact that each diamond is a heterogeneous and unique piece with its own specific characteristics whereas gold is a homogeneous substance which can be valued as a commodity. Click on this link for more information about the characteristics of diamonds.
Invest in diamonds vs invest in gold - Baunat Diamonds