Diamonds an Investor’s Friend?

Posted in Aesthetic Investments

 

Are high-grade diamonds competitive with conventional asset classes as investments? In his April 2013 paper entitled “The Returns on Investment Grade Diamonds”, Luc Renneboog examines secondary market returns and risks of investment grade gems (white diamonds, colored diamonds and other gems such as sapphires, rubies, and emeralds). He compares their investment performance metrics to those of stocks, corporate and government bonds, gold and real estate. He ignores trading frictions.¬†Using data for 4,750 transactions at gem auctions during 1999 through 2012, he finds that: (more…)

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