Diamonds value, types, characteristics, quotation, invest
Welcome back dear loyal readers of Invest In The stock, we are always very happy and satisfied to have you here with us again. In today’s article we will talk about investments, more specifically we will talk about valuable diamonds.
We will go to see the types, characteristics and peculiarities of this coveted precious stone. We will also analyze the price and how to invest in this safe haven asset.
What is diamond?
Let’s first see what diamonds are and how they are formed in nature.
Basically, these are minerals composed only of carbon, and are considered the precious stones par excellence.
Analyzing them on a chemical level, diamonds are formed in the same way as graphite, and the only difference between these minerals is the atomic structure.
The structure of diamond value calculation is cubic and is formed at high temperatures and pressures.
These precious stones are found in nature within particular rocks, the kimberlites, originating from the cooling of silica-poor magmas that form in the ground.
Where are diamonds formed?
Diamonds worth one carat are created under conditions of high pressure, therefore, the initial process takes place deep in the earth’s crust, usually between 100 – 300 km below the surface.
In order for diamonds to be created, the necessary temperature is between 1100 °C and 1300 °C, combined with very strong pressure.
How to distinguish a diamond?
One of the questions that those who want to invest in diamonds ask themselves is knowing how to distinguish a real diamond from a fake one.
The first thing to do is to check and observe its color and brightness.
In fact, industry experts use a magnifying glass to look for scratches, grooves and marks that cannot be found on a valuable blue diamond, given that it is a hard and resistant stone.
Another thing to do to have no more doubts is to check its specific weight, which varies in each mineral.
Parameters and types of diamond cuts
There are several parameters that are used in the mineralogy sector to evaluate and quote financial diamonds.
In jargon the four Cs of diamonds are defined, namely:
- Carat
- Cut
- Color
- Purity
We analyze these parameters below.
Carat
The first parameter is used to determine the characteristic weight and mass of the diamond.
Also, the unit of measurement for the carat is 0.2 grams.
Cut
The cut instead refers to the proportions and shape of the gem.
It represents a fundamental feature in the final creation of the stone.
This practice can take a long time if you want to obtain an excellent final result, and the raw material can lose up to fifty percent of its initial weight.
Color and purity
The color and clarity of diamonds are defined using a scale that goes from D to Z.
It starts from the snow white color (that is the most popular shade of carat value diamonds) up to the letter Z (where we find the less pure color point: the pronounced yellow).
There are also the very rare black and red variants, they are such particular gems that they have a very high value.
Red diamonds, especially, are extremely rare precious stones, so much so that there are about thirty of them in the world.
How is the value of diamonds calculated?
Let’s start by saying that to calculate the value of investment quotation diamonds, wholesalers, retailers and anyone who invests in this precious stone relies on official quotations.
Therefore, one of the best known lists is the Rapaport diamond report, which can be consulted for a fee.
But this is still not enough to establish the value of diamonds today.
In fact, diamond prices are elaborated through hypotheses on the levels of purity and quality.
This basically happens because each diamond is unique.
So anyone who buys a diamond to invest must essentially have a certificate drawn up by a trusted and authorized gemological institute.
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Diamond certificate
So let’s see what the diamond certificate is.
Basically, it certifies the quality, truthfulness and value of the diamond.
One of the most important gemological institutes worldwide is the IGI (International Germological Institute), followed by:
HRD (Hoge Raad Voor Diamant), whose headquarters are located in Antwerp in Belgium
GIA (Gemological Institute of America)
To have all the trappings of the case, the diamond certificate must bear the signature of an authoritative certifying body, and obviously it must be complete.
Inside it must be present the serial number and the diagram of the stone, as well as reporting the information relating to the 4 C diamonds, the shape and size of the diamond, finally the fluorescence and the finish.
In some cases, the document also mentions lasering the gemstone.
Carat price diamonds
As mentioned earlier, there are universal rules for calculating the value of diamonds.
First of all, the price of a diamond is calculated through the price per carat, therefore, per unit of weight.
If we had to give an example, let’s take a diamond weighing 0.50 carats, which falls within the price range of 2000 euros per carat, the value of that diamond will be 2000×0.50, and therefore, 1000 euros.
It should also be borne in mind that the prices of safe-haven diamonds, per carat, rise according to the weight category.
Consequently, the price per carat of a 1-carat diamond is lower than that of a 2-carat diamond.
So, in summary, the prices of investment price diamonds rise more with the increase in weight.
Safe haven diamonds
In conclusion, carat value diamonds, as well as gold and other precious stones, are safe haven assets.
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Therefore, when the financial markets are in a severe crisis or recession, they are assets that guarantee that the value remains unchanged over time or that they acquire value.
For this reason, we at Invest in The Stock advise you to evaluate well if you intend to invest in diamonds, the quality of the gems, the carats and the purity, which are the main characteristics to take into consideration.
Well dear friends, now thanks to our complete guide you have all the information you need to invest in valuable diamonds.
Invest In The Stock, The Editorial Staff
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