Atkinsons Bullion & Coins
Back to July 2019
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There are may reasons as to why people decide to invest their money in assets such as gold, shares, property and jewellery, as investing in assets like these can help to grow and protect your wealth for the future. Which asset you decide to invest in depends on what you want to gain from the investment itself, as each offer their own unique benefits and drawbacks. In this article we’ll be looking at the pros and cons of investing in diamonds versus gold.

Protect Wealth

A core reason why many choose to invest is to protect their wealth against economic fluctuations. The value of assets like property and shares are heavily influenced by the global economies so they can lose vast amounts of value, almost overnight in some cases, should an economy crash like it did in 2008. Both gold and diamonds are often used to hedge against the forces of inflation and uncertainty on global markets. They often appreciate in value in times of economic slumps where trust in paper money falls and so the value of assets such as gold and diamonds become a more trustworthy measure of wealth. In this respect, both could be seen as positive investments for protecting wealth in the long term.

Demand Driven Value

The value of diamonds is, in part, driven by the demand for them across the world. There has been a marked increase in diamond demand in recent years, driving up their value. This trend is reported to be expected to continue in the future. Gold, however, is not as affected by levels of demand like diamonds have been, which means it can be seen as a more stable investment in the long term.

Status Symbol

Diamonds are highly coveted globally, and their value reflects that aspirational demand. We see diamonds worn by celebrities and other wealthy people in the public eye, and a red carpet is often accompanied by glamorous gowns and sparkling diamond necklaces. We also see diamond engagement rings offered to a loved one in return for a marriage agreement. These connotations and the knowledge that they are rare and precious, all add up to create the high value placed on diamonds. However, this ideology has enabled diamond suppliers to keep the cost high. This is one of the reasons some choose to invest in diamonds, to wear them as a status symbol to visualise wealth and power. However, wearing an investment piece such as a diamond can lead to damage or even theft, meaning your diamond may depreciate in value. A problem not encountered as often for gold investors; whose investment more than likely stays tucked away in a safe hidden away from the rest of the world until it is needed.

Selling & Diamond Knowledge

Assets are a great way of protecting wealth but selling them back to liquidate funds is a key consideration when investing. This is where diamond investments can present a serious drawback. Selling diamonds can be a long-drawn-out process, with them having to go through some form of auction process where the auction house will often take a cut of the sale. A fair amount of knowledge about diamonds is required to invest in them successfully due to the huge number of varieties and differences that only an expert would be able to identify. This not only makes it difficult for a novice to truly know they are investing in a quality asset, but also hard to then sell that for the right price in order to see a ROI.

This is not something that is required when investing in gold. Gold can not only be sold almost instantly, but little knowledge about the precious metal is required to invest in the asset and more information is widely available on the product. This makes gold a more simple and reliable way of investing when it comes to ROI, we display the buy-back price of gold on our website, and that's the amount you will receive as there is no sales commission. These buy-back prices are based on a percentage of a moving gold price.

Once you have decided to invest in gold for any of the reasons detailed above please speak to us. Our team have the knowledge and experience to assist you in your investment journey. Whether you’re looking for gold coins or gold bars, contact us today.

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This blog represents one person’s opinion only. Atkinsons are not permitted to give investment advice. You should conduct your own research and seek professional advice to ensure investing in gold is right for your circumstances.


1 Comment(s)

Also, because of the reasons you have given, there are plenty of scammers out there even amongst jewellers. Jewellers differ on their opinion on grades. You really have to send the stone off to a lab to be assessed but that could be costly and uneconomical but for large carat expensive stones. This is why Indians use cheap decorative stones on their 22 and 24 carat gold jewellery.

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