Talk:Diamonds as an investment

Untitled

The article needs to discuss the overpricing of diamonds through DeBeer's controlling of the diamond market and creating an artificial shortage. Rmhermen 19:40, 6 October 2006 (UTC)

See http://www.theatlantic.com/doc/198202/diamond for reference. 2006-11-21

This article needs to be referenced and cleaned up to reflect the encyclopedic nature of wikipedia. SauliH 08:13, 9 December 2006 (UTC)

This article sounds to have a lot of original research and is presented like an essay, not an encyclopedic article. Momo Hemo 10:04, 6 January 2007 (UTC)

Comments on above:

Aber has now bought 100% of the Harry Winston Inc. chain and is no longer a diamond mining venture alone, but rather a hybrid mine-retailer. The anticipated mine life of the currently producing pipes is not that long, and development of other target pipes on the property into actual mines is perhaps uncertain (see their website) so that unless they acquire other diamond mining properties they may end up eventually migrating into being primarily a retailer.

In fact, when discussing investment in diamonds, I would like to see the article expanded to cover what might be called "wider diamond industry investments" with more information on investments sectors beyond polished stones and mines....for example, retailers, equipment manufacturers, and service providers.

There are a few English language academic sources on diamonds as investment that I will try to dig out and post as references but if anyone has sources ready at hand don't wait for me. FurnaldHall 11:51, 5 February 2007 (UTC)

"I would like to see the article expanded to cover what might be called "wider diamond industry investments"" Good idea nirvana2013 10:39, 20 March 2007 (UTC)

Dispute tag

Hi, I am not involved with editing this topic, but am just stopping in as a wandering admin. I see that this article has been tagged as disputed for over a year, but there doesn't seem to be any active discussion on it. Has this been resolved yet? If not, I recommend either moving forward on resolving the dispute, deleting the disputed information, or else just removing the tag. --Elonka 23:25, 12 March 2008 (UTC) I don't think that anyone within the diamond mining industry will make alterations to any document which mentions Debeers. They are a very powerfull entity and those within the industry have to respect that fact. Power is everything in the diamond mining industry.(Miningspecialist (talk) 18:00, 13 March 2008 (UTC))

Diamond prices as a reference

Hi,

I thought I would ask here first, have a look at this site as a reference for current online diamond prices. I think it could be relevant for this article since it shows the market trends with all the diamond criterion available and allow a good overview of diamond investments at particular times (besides that is has a professional information section). Anyway, have a look and if you think it is decent http//wwww.gemisimo.com/ This site was blacklisted by wiki about a year ago but it has improved and it would be great to get an opinion of fellow wikipedians --Davidoff (talk) 12:33, 8 June 2008 (UTC)

(second comment) One might suggest that cultured / artificial diamonds should be mentioned in this article. Unlike pearls, they are more perfect than the 'real' thing, and extremely cheap to produce in comparison. —Preceding unsigned comment added by 71.59.212.56 (talk) 19:32, 19 October 2008 (UTC)

Liquidity

I'm no expert, but from everything I've read diamonds become liquid when you have a million dollars worth to sell at one time. Then you can find a broker who will charge a 2-4% commission ($20,000-$40,000 minimum). The broker can put you in touch with potential buyers, including hedge funds, diamond wholesalers, etc. At 1/2 million you might still have a chance, but I wouldn't count on it. Also, the standard recommendation is that you should not have more than 10% of your portfolio in alternative investments, with no more than 5% in any asset class (such as gold) and no more than 1%- 3% in diamonds. That means you need at least $30-100 million in your retirement savings account before you are qualified to invest in diamonds.

There is an entire industry devoted to selling "diamonds as an investment" to people who are not remotely qualified. Zyxwv99 (talk) 17:34, 27 March 2013 (UTC)

Financial Feasibility section is premature

The section about the USPTO and the S-1 filing with the U.S. Securities and Exchange Commission is conjectural. When it actually happens, in 2014, as the current text describes, THEN will be the time to include it. It has not even occurred yet, and does not belong here. Similarly, it is inappropriate to give direct links to U.S. Patent Office filings and S-1 documents without any more mainstream coverage of content.

==Financial feasibility== On August 7, 2012, the [[USPTO]] patented a process that classifies Investment Grade Diamonds for commercial trading and financial investments,<ref> US 8,239,211 [http://www.uspto.gov/web/patents/patog/week32/OG/html/1381-1/US08239211-20120807.html] </ref> the precursor for diamonds being a publicly traded asset class. As a result, a Physically Backed Diamond ETF is currently under [[US Securities and Exchange Commission]] Registration and is anticipated to be available on the [[NASDAQ]] Stock Market by 2014.<ref> FORM S-1 [http://www.sec.gov/Archives/edgar/data/1574109/000089109213003304/e53108s1.htm] </ref>

I have removed that section, and left it copied here, verbatim (see above), for such time that those events may come to pass. --FeralOink (talk) 17:41, 28 April 2013 (UTC)

I am familiar with this patent. Martin Rapaport is apparently working on creating a mutual fund based on a quarter-billion dollars worth of diamonds to be held in a vault. His description of how it would work bears obvious similarities to the patent. On one level what Martin Rapaport is doing is notable, and by extension the patent. However, this is all very peripheral to diamonds as an investment, as it says more about the liquidity of mutual funds and assets held by mutual funds than about diamonds per se for the average investor.

More to the point, this material seems to have been included as part of a general program to spam this article for International Diamond Exchange. Many companies sell "diamonds as an investment" with no hint as to how anyone could ever liquidate them. A few companies, including International Diamond Exchange, promise to buy them back at a price based on current published wholesale prices, taking into account commissions or brokerage fees. This business model is neither new nor notable. Furthermore, since International Diamond Exchange is a new company, it has every incentive to spam the Wikipedia. Zyxwv99 (talk) 14:36, 30 April 2013 (UTC)

Spam alert - fancy colored and recycled

The part alleging that fancy-colored diamonds have been a secure investment over the last five years is not supported by either reference. The Wall Street Journal article is from the Fashion section, and merely mentions that some price increase has been driven, in part, by people seeking gems as investments. The type of verbiage found in this paragraph of the article is typical of what one finds on websites fraudulently selling diamonds as an investment even though, at the level of all but the biggest investors, they have no liquidity. Since this article has not established that diamonds are an investment, and if so for whom, it is misleading to state what this paragraph states.

Next, recycled diamonds. This has been going on for generations, if not centuries. As soon as a new diamond cut is invented, a certain number of old stones get re-cut. For the people involved in diamond recycling, diamonds are inventory, not an investment. With inventory, the object is to dispose of it as quickly as possible. I can only think of two reasons why this section was added. First, to address a persistent myth that diamonds are never recycled. (The infamous Atlantic Monthly article mentions this.) A second, more nefarious reason, is to suggest that diamonds have more liquidity than they really do. In fact, consumers who sell used diamonds nearly always take a haircut, typically getting 30%-70% of wholesale. Zyxwv99 (talk) 17:17, 12 May 2013 (UTC)

The spread in gold is $1 a troy ounce or so, much less than the de facto spread in diamonds.

For small quantities, such as one troy ounce, the dealer's spread for gold would be about 10% or 20%. I am assuming that there is no tax.

Delete "Recycled Diamond Market"

This section has nothing to do with diamonds as an investment.

There is an entire industry of professional con artists who purport to sell "diamonds as an investment." This is typical of the sort of "smoke and mirrors" they employ in their marketing literature. They discuss issues that are perfectly legitimate but have nothing to with the subject at hand. Instead, they have merely to do with diamonds in general. In this case, consumers who want cash for their diamonds are selling them to jewelers for 30% - 70% of the wholesale price. Once jewelers come into the possession of jewelers, the diamonds become inventory. At no point in the process is investment involved. Zyxwv99 (talk) 13:38, 17 May 2013 (UTC)

Actually having a recycled diamond market is an important aspect of whether diamonds are a good investment, since they allow for a sale avenue. Liquidity is a perenial problem. Having a developed market for sale promotes price transparency etc. Tsop (talk) 15:43, 11 March 2015 (UTC)

Polished diamonds

The Polished diamonds section is overlong and rather confusing to read. It really needs a rewrite, which I don't have time for right now, but it's the reason I put the "confusing" tag on the article. --Slashme (talk) 15:35, 22 February 2014 (UTC)

Potential Issues

Some Italian investors have raised concerns about the behavior of a number of Companies selling diamonds as an investment, through bank channels . As such, this article should be carefully weighed and reworded to take into account these events, as the absence of warnings - which can also take the shape of undesired and involuntary omissions of information pieces - may be a potential source of confusion for people who try to find third-party information about economy topics. — Preceding unsigned comment added by SuperKotik (talk • contribs) 06:31, 23 February 2019 (UTC)

References