Buying loose diamonds? A worthwhile investment!

Demand and thus value of loose diamonds is rising!

Although gold is still one of the favourite investments, we have noticed a surge of interest in loose diamonds for investment the recent years.

The most recent study by De Beers (Diamond Insight Report 2015) shows that the Indian investors worldwide belong to the top of loose diamond buyers. The growing Indian economy and strong population growth cause an increase in demand for gems and thus loose diamonds. It is even predicted that global demand for diamonds will be higher than the available supply.

The outlook for loose diamonds for investment property is very positive, but there are some important parameters that you need to consider when buying loose diamonds. Despite the usual certificates, trading in loose diamonds is not always uncomplicated.

Pricing of loose diamonds

When you are considering buying loose diamonds, you can best do this when you have sufficient knowledge and experience to estimate its value or when you get the support of a specialist in this field. Even if loose diamonds are accompanied by the necessary certificates and official valuation, you need to negotiate about the final purchase price as a potential investor. Any negotiation strategy for loose diamonds should be determined based on the 4 C’s: cut, clarity, colour and carat. These parameters determine the final value of the diamond. Again, we advise you to appeal on a specialist you trust.

Redemption value of a loose diamond

In addition to the purchase price, defining the potential repurchase price (buy-back value) of loose diamonds is also a challenge! The redemption price will vary from merchant to merchant. In an ideal situation you would recover 95% of the current market value. For smaller loose diamonds, it will generally be less. It is important that you negotiate this repurchase price before you purchase the loose diamond.

Do you want more information about loose diamonds for investment, please contact our specialized team.

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Author: Alexander Schmitt