Diamond Exchange Primer For Investors

It’s a truism in today’s troubled times that a diamond exchange is the only friend an investor has. Everything from blue-chips to real estate has tanked badly, and the volatility of oil markets involves too much risk for hedging. Diamonds are still extremely valuable with a stable market. The best part is that demand will be much higher than supply over the long-term.

Prospective investors still need to do some groundwork and must learn how these stones are bought and sold in exchanges. It’s not like two people can just sit across the table and conclude a transaction. Most diamonds are routed through exchanges that can be found in every part of the world.

These exchanges not only set the prices, but also take responsibility for acquiring the stones, grading them, providing certifications and safe delivery to the buyer. The grading and sorting process is dependent on factors such as size, shape, color and clarity. Every stone is unique, and can be placed in 12,000 categories.

As a general rule, diamonds will either be used as a gem or for industrial purposes. Gem grade diamonds are bought by jewelers. Industrial grade stones find applications in all kinds of drilling and cutting tools due to their hardness.

In order for diamonds to be considered legit for trade, they must have at least a couple of certifications. One is the certificate issued by a GIA (Gemological Institute of America) lab after an examination of the stone and its attributes. The other one is a Kimberley Process certificate which weeds out stones that are conflict diamonds.

The operations of most of the major exchanges are usually subject to the standards set by the World Federation of Diamond Bourses. WFDB members include the largest bourses from all over the world. The entire system has been fine-tuned so that rough and uncut diamonds from mines can move smoothly to the skilled staff at the diamond exchange for processing, and then be safely handed over to buyers for polishing and use in their applications.

To obtain additional information about loose diamonds for investments, simply call Investment Diamond Exchange (IDX) and an account representative will respond all of your questions.

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