Diamonds as Timeless Investments and the Importance of Knowledge for Value

Diamonds have been seen as investments for centuries, people have more millennia bought and kept diamonds along with precious metals such as gold and silver as these elements almost always increase in value over time. Many purchase diamonds for either personal use or for keeps until the value of the diamond increases to a point where the investors deem as a good time to let them go.

However, before one decides to embark on an investment spree the ability to make informed decisions at purchase point is critical and to be able to do this one must possess fair knowledge about the structure of the diamond. Having sufficient knowledge about diamonds would increase the ability of the buyer to secure a good deal, meaning he or she would have the ability to buy diamonds at suitable prices and also help avoid being duped into buying low-value stones at exorbitant prices.

First and foremost, it is crucial that one have a basic understanding of the chemistry of a diamond and the first fact that one should know that the basic element of the diamond is actually carbon. These stones are among the hardest substances on earth and this is not because of the ‘carbon’ element only, the hardness is actually attributed to the arrangement of carbon atoms that render diamonds as tough as they are. 

These arrangements are generally caused by intense pressure and heat that result in repeating units of carbon atoms where every atom gets connected to four other atoms which are regarded scientifically as the covalent bond which is very strong due to the nature of the electrons of the atoms are shared.

Knowing this the quality of diamonds vary significantly which means that they vary in terms of aesthetics and prices are based on not just aesthetics of the diamond but also colour due to the fact that some colours are rarer than others, for instance argyle diamonds or pink diamonds which are extremely rare are generally priced higher even though the clarity of the pink diamond is lower than a yellow diamond.

The scarcity of pink diamonds makes them more desirable than other colours and it is only due to this that they are priced higher.

Other factors that cause price variations among diamonds of the ‘same type’ or grade are the 4 Cs (Carat, Clarity, Cut and Colour which has been explained above). The carat is a straight forward price element based on the fact that carat basically means weight, and as most of us already know, the heavier the diamond, the bigger it is and pricier it gets.

Diamond cuts are also a critical factor towards the price determination of a diamond. In general, the cut of the diamond is behind the diamond’s sparkle or flashiness, meaning if the diamond is not cut properly the diamond will appear or look dull despite the fact that the diamond has high clarity and rare colour.  

In other words, diamonds that have average clarity can be made to look more appealing than a diamond with high clarity due to the cut.

In summary, within the world of diamonds, there is no such thing as a bargain deal, there are only ‘fair deals’ and this generally depends on the diamond shop wholesaler.