Buy diamonds – Lesson 4
If you decide to buy diamonds, you have to consider two particular aspects of this market: the purchase price and the degree of liquidity.
To understand these issues, you must consult experts in the field that have the necessary scientific knowledge and extensive business experience.
The purchase price:
In the buying process, the price will increase for each intermediary and commission. The more commissions you will pay, the more difficult it will be to sell with a gain for you.
Don’t forget that diamonds are traded through 28 diamond bourses, scattered all over the world, connected electronically where professional diamond traders can meet to match supply and demand.
The degree of liquidity:
If the purchase price is too high, the diamond will be too expensive at the time of resell.
In addition, buying a certain quality of diamond, which does not have a real demand from the market, can cause problems selling at a good price at the time of need.
The demand for diamonds is related to the demand of jewellery that is influenced by the choices and trends of traditional and emerging markets, where a new consumer generation is growing. Investors or financial advisors must be aware of the historical trends and consumption forecasts for the coming years.
Just as in the financial market there are hundreds of thousands of investment products, so too in the world of diamonds there are around 16,000 quality categories, each of which has its own price trend and its degree of liquidity. You can choose a diamond category demanded by the market which easy to sell or a diamond rarely traded on the market: it will be harder to sell but probably more profitable for you.