Although people usually buy gold jewelry during Diwali for investment purposes before the wedding season, you may be confused whether you should buy gold jewelery without gemstones or whether you should buy diamond jewelry.
ET Wealth (online) spoke to jewelers and experts to know if you should buy gold or diamond jewelry for investment purposes. This is what they have to say:
Surendra Mehta, National Secretary, Jewelers and Bullion Association of India: It is better to buy gold jewelery or gold coins and bars this Diwali instead of diamond jewellery. Unlike gold, which can be hallmarked by the Bureau of Indian Standards (BIS), there is always a question about the clarity of diamonds. There is no certification of a diamond’s clarity from a government agency like the BIS. The government has declared gold as an asset class while diamonds remain a consumable item as it is difficult to get the correct resale value of diamonds through buyback options.
Furthermore, diamond prices are currently falling and no one knows where the bottom is. From an investment point of view, gold scores better than diamonds as one can easily take a loan against gold, but banks do not give loans against diamonds. Now there is also competition from lab-grown diamonds. Lab-grown diamonds are identical to natural ones. Only those who wear diamond jewelry know if the diamond is natural or lab-grown.
Aditya Modak, CFO & COO, PN Gadgil and Sons: Gold bullion might be a better option from an investment perspective. Even in case of jewellery, gold jewelery will offer better returns than diamond jewellery. When purchasing diamond jewelry, you invest approximately 50% in the stone and 50% in gold. Historical data has shown a steady rise in gold prices over the past few decades, proving that gold has shown promising results as an investment. However, diamond jewelry offers a unique and safe balance of investment risks. Potential fluctuations in gold and diamond prices act together to stabilize the investment, providing a sense of peace of mind about the stability of your investment. Therefore, it all comes down to personal preference on how the buyer perceives the value of diamonds and gold.Suvankar Sen, MD & CEO, Senco Gold & Diamonds: For consumers looking for a simple, liquid and culturally meaningful investment this Diwali, gold remains a good option. With global uncertainties and ongoing conflicts, gold prices are expected to rise, making it a wise choice for long-term value. However, diamonds also present an attractive opportunity, with current prices lower than usual. This makes diamonds a feasible and potentially rewarding investment, especially for those looking to diversify their portfolio. As we approach Diwali, consumers are often faced with the choice between purchasing gold or diamond jewellery, both of which have unique value. With the wedding season just around the corner, wedding jewelry is in high demand. Given the current rise in gold prices, many consumers are opting for lightweight, everyday diamond jewelry, which offers elegance and practicality. While high gold prices may impact the volume of gold purchases, the overall value of consumer spending remains significant.
For traditional functions and wedding festivities, gold remains the preferred choice due to its timeless appeal and cultural significance. However, for everyday wear and social gatherings, diamonds offer a modern and modern look, making them an attractive option for those seeking long-term style and value.
Vikas Singh, MD & CEO, MMTC-PAMP: While diamonds fascinate with their brilliance, gold has been an unmatched investment option for people for years. Investing in gold offers several advantages over diamonds. Gold is very liquid and has a well-established global market that makes it easy to buy and sell. Its value has historically been recognized as a store of wealth and offers long-term stability, especially in volatile markets. Gold is also considered a safe haven during economic crises, while diamonds are influenced by trends and subjective characteristics such as cut and clarity. Furthermore, gold is more fungible and cannot be produced synthetically, which guarantees its rarity and constant value over time. In contrast, the emergence of lab-grown diamonds has led to significant price reductions and lower demand in the diamond market, further challenging their investment potential.
Based on the insights offered by these experts, it can be concluded that if you only have investment in mind, then opting for gold might be a better option; However, diamond has its own appeal that many may prefer due to its utility value as an ornament.
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