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

Longterm volatility
High
Low

Weight for the same value**
150 gr
0.2 gr for 1 ct

Transportability
Low
High

Tangibility
Medium
High

Esthetics / 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.

Learn more about diamonds as an investment Click here for more information about the characteristics of diamonds.