Should diamonds really be a girl’s best friend?

A gift of a diamond or a purchase of one makes us feel immense pleasure of owning that much awaited shine. The precious stone has been the love of a woman’s life since its inception.

But are diamonds really worth the price they are made out to be for? Or for that matter does it really make sense to buy diamonds at all? What is it that makes them so expensive?

Buying diamonds is easy, selling them is not:

As long as you have money in the pocket, diamonds are available over the counter. But what if, someday a financial emergency arises and you need to sell them?
Selling diamonds is nowhere as easy as selling gold or silver, for that matter.

A lot of jewellers do not buy back diamonds that are not sold by them. Also in most cases they offer 75-85 per cent of the diamond price for the day.

If a jeweller does agree to buy back a diamond he may do so on the condition that you buy another diamond of a higher or at least the similar variant from him.

Chances are you may not be able to buy gold jewellery by selling diamonds.
What is the price of a diamond?

Gold has a daily price. So has silver. So if you go to buy or sell gold, you are most likely to get a price around that daily price.

But in case of diamond there is no standardised pricing. There is something known as the Rapaport Report, a weekly publication issued to jewellers. This clearly puts out the price of diamonds based on what are known as the 5Cs -- carat, clarity, color, cost and cut.

Due to these reasons when you go to a jeweller to sell a diamond you have absolutely no idea of the price he is going to offer.

Diamond prices have been flat:
Over the years, diamond prices haven't gone anywhere. In fact, diamond prices have been more or less flat over the last five years. And we all know the humongous return that gold and silver have given during the same time period.

Over the years, some large diamond producing countries have been trying to get out of the DeBeers monopoly and this has kept the diamond prices flat.

Experts suggest that DeBeers now controls only about 40% of the market unlike earlier when it used to control more or less 80 % of the market.

So if not diamonds, what should an individual buy?

If you are really into diamonds and cannot for the heart of it wear gold or silver jewellery, you should be buying fake diamonds, i.e. man-made diamonds or else just to pacify yourself of buying those expensive but yet not so appreciated precious stones.

So the moral of the story is that there are better ways to spend your 'hard earned' money than buying diamonds.

Source: http://www.rediff.com/business
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