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6 Things To Know Before Investing In Diamonds

Purchasing a diamond ring is a lifetime investment that requires knowledge about quality, cost, and other features. Most purchasers have no idea what they should consider before purchasing a diamond ring or other diamond jewelry. Investing in diamonds or jewelry is a good investment because of security and the returns in the longer run. 

People often commit mistakes when investing in diamonds. Understanding the basics can help the buyer avoid these mistakes. Diamonds are not only a commodity but a token of love, a lifetime investment, etc. 

People make proper strategies to benefit from their investment. It doesn’t require one to be a professional to make it successful. The estimated amount of worldwide diamond reserves is about 1.2 billion carats as per stats available on Statista.

Here is a brief overview of some considerations to make before purchasing diamonds.

Considerations Before Investing in Diamonds

Here are considerations that a potential diamond investor should make before purchasing diamonds. These will help with getting the best quality diamond pieces within one’s price range.

Do Market Research

Doing research is important before purchasing any diamond jewelry. One should consider the market prices and other important factors. Sometimes jewelers sell diamonds for a price higher than actual, so it is better to stay on the safe side.

To start, the best practice is to know what the average wedding ring cost within the area. The investor can also try to check the designs they like and save them for future references when one’s about to buy. 

Diamond engagement and wedding rings can have higher mark-up prices than other diamond jewelry. Having knowledge about their price range will give the investor an idea of how much other jewelry pieces costs.

Manage Expectations About Diamond’s Quality Given Your Budget

After simple market research about the average prices of diamonds, a potential investor must manage his budget. However, many investors must also manage the expectations they have with the quality of diamond they will get within their price range.

Not every diamond is created equal. Different grading standards for diamonds help determine their value and beauty. The complete details of a diamond can be seen using standards like GIA and AGS, for example. 

If the grading of the diamond is according to these or other reputable standards, it will help make the investment reliable. 

When investing, one should know that the cost of a diamond piece heavily depends on the 4Cs that determine its quality. But what are these 4Cs? Each of these is discussed here separately. 

Carat Weight

Carat value is one of the most critical metrics for the quality of a diamond. There are various diamond carat sizes available in the market. Magic carat sizes in a diamond determine its price. These might go as high as 5.00 carats or more.

The price of diamonds goes high with the carat size as it grows exponentially. An important fact about the carat size and face-up area is not always in proportion. So, the customer should consider the amount they would have to spend on a higher carat value compared to a lower carat value.  

Color Grade

Most people might think that diamonds are colorless. However, there are instances when diamonds are made with a hue of pink or yellow. Pink diamonds are rare, making them extremely valuable. Diamonds with a pink hue are often bought by collectors or auctioned at a very high price point.

On the other hand, diamonds that are heavily tinted with yellow are sold at a much cheaper price. Yellow tints in diamonds are considered a blemish, unlike pink ones. 

Yellow diamonds fall under the same color grade spectrum as colorless diamonds. Their grading bracket is as follows:

  • Grade D-F: colorless diamonds
  • Grade G-J: near colorless diamonds
  • Grade K-M: diamonds that are slightly tinted with yellow
  • Grade N-R: diamonds that are very lightly tinted with yellow
  • Grade S-Z: diamonds that are lightly tinted with yellow
  • Clarity Grade

The diamond’s clarity determines how many blemishes it has. Since diamonds are made under different weather conditions, it is more likely that a diamond piece has blemishes like fibers and sand included in it.

The grading for clarity depends if the blemishes it contains can be seen by the naked eye. Its grading is as follows: 

  • Grade I: Included, which means the blemishes can be clearly seen by the eye
  • Grade SI: Slightly Included
  • Grade VSI: Very Slightly Included
  • Grade VVS: Very very slightly included
  • Grade IF: Internally Flawless, meaning it has little to no microscopic blemishes
  • Cut Grade

The diamond’s cut is also a factor of how much a piece should cost. Diamonds are cut at a specific angle that would maximize their sparkle as the light reflects on them. The cut must not be too deep or too shallow so that the diamond can properly return light, making it shine, even from a distance.

Considering Alternatives

Different choices are available in diamonds, and their costs vary based on their origin. These include mined diamonds and lab-made diamonds. The latter get more attention compared to mined diamonds because of their prices.

Lab diamonds are comparatively cheaper in price compared to mined diamonds. Overall, lab-grown diamonds will provide you with up to 30% off of the average ring cost. They can help with the compromise on cost but won’t affect the ring’s beauty as there is little apparent difference between the two. 

These diamonds are as authentic as natural diamonds based on the qualities and composition that a mined diamond features. 

Determine the Diamond Shape You Want

Diamonds are also cut into different shapes. Each shape has a different number of edges and the more the edge, the more it shines. However, it is important to note that each shape has its pros and cons.

Shapes such as round, heart, rectangle, pear, and trilliant are available. Most of these basic shapes also have variations. For example, round, Portuguese, and eight-cut are all on the circle shape side. On the other hand, both princess and cushion cuts are on the square side while the emerald cut is more rectangular in shape.

There are also cuts with a distinct pointed part like the pear cut, also known as the teardrop. Diamonds with pointed ends, however, are more prone to chipping.

Choose Quality Diamond Hardware Material

In every piece of jewelry, there is hardware keeping the stones intact. For instance, a diamond wedding ring can be made with gold, silver, or platinum hardware. Rose gold hardware is also gaining popularity nowadays. 

In investing in a diamond piece, one must also consider the hardware that comes along with it. It should also stand the test of time just like the diamond stone itself.

Pick a Timeless Ring Style

Diamond is important in a diamond ring, but the ring style is also important. It should attract a customer’s equal attention when purchasing a diamond. There is no denying that a diamond has a great role in determining the value of a ring but its style and design equally matter.

The color and design of the ring are important when you purchase a diamond ring. If these are ignored altogether, it will affect the appearance of the diamond. So, it should be one of the most important considerations while investing in a diamond.

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People prefer different settings of diamond in the ring, so you should take time and see if it can save you costs as well as follows your choices.

Conclusion

Purchasing diamond rings is a good investment that can bring considerable profit to the investor. It is not always easy to get the best diamond according to the available budget. Thus, a purchaser can use the above-given standards to see what fits them best. 

They would be able to save money and get diamonds that would fit their needs. They should consider these standards and see diamonds with a critical eye which would help them much.

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