More and more people do not want to rely on financial instruments such as stocks, bonds, and mutual funds, which may be valid, but recent events have shown them to be risky, especially for small savers. After several financial crises, people want to see what they are investing in, they want to touch what they are investing in, and investing in diamonds is back in vogue. Investing in safe assets is the first thing that comes to mind for people who have saved some money in their lives, and buying jewelry or gold to diversify their investments can be a good solution!
Why Are Diamonds So Expensive?
When it comes to diamonds, their price is very high. But why is this when its basically just a stone-like piece of glass? The history of diamonds is not as simple as the history of other very famous commodities, such as gold, silver, and copper. Diamonds were considered precious stones because of their brilliance and rarity.
How Is a Diamond Formed?
Diamonds are not formed in the way many people believe. In other words, it comes only from carbon atoms, which gradually turn into oil over a long period to become diamonds. For carbon to form, it needs to be subjected to the enormous pressure created when earthquakes move the earth’s mantle. After being formed about 150 kilometers underground, diamonds are brought to the surface by lava flows that fuse well with kimberlite.
How Do You Calculate the Value of a Diamond?
Here is one of the most difficult points to make, and why diamonds are indeed a safe investment, but only if purchased from a trusted person or company. To establish the value of a diamond, the 4c rule is used.
COLOUR: Everyone knows that diamonds are not only transparent but can be dyed in any color. However, the purest gemstones are colorless, i.e., completely transparent. The color of a diamond results from impurities, or carbon atoms (or atoms), replacing other substances and giving it its particular color.
Some colors are scarce, such as green, while others are more common, such as yellow, the latter being due to the replacement of carbon atoms with nitrogen atoms.
CLARITY: It is given by the degree of flaws a diamond has. In the eyes of experts, there is nothing in the gem, i.e., it is entirely transparent. This is a pure diamond and is given the abbreviation F. Gradually; there will be abbreviations that indicate lower clarity.
WEIGHT or CARAT: This system is also unknown to many investors who have never spent their savings on diamonds. A diamond’s carat is expressed in its actual weight; one carat is equal to 0.2 grams; a 1 gram diamond is 5 carats. Carats are divided into “grains,” which are one-twentieth of a gram, and “points,” which are one-hundredth of a gram.
CUT: The cut of a diamond stone is the fourth and final criterion that determines the stone’s value. There are three most common types of cut, which vary in value:
- Excellent (a cut with no flaws or impurities and exceptional brilliance)
- Good (a cut with few impurities and moderate brilliance)
- Poor (a cut with some flaws)
Investing in diamonds means not losing your money in the first place. Diamonds revalue at about 4.3% per year, and if it’s not big speculation, it’s the same as investing in government bonds: slow but steady growth.
If you’re looking for magnificent and timeless pieces of jewelry, visit Richview Jewellers in Toronto. Their unique designs and creations of necklaces, pendants, bracelets, and more will surely leave you breathless!