Though people usually buy gold jewellery during Diwali for investment purposes ahead of the wedding season, you may be confused if you should buy gold jewellery without gemstones or if you should buy diamond jewellery.
ET Wealth (online) spoke to jewellers and experts to know whether you should buy gold or diamond jewellery for investment purposes. Here is what they have to say:
Surendra Mehta, National Secretary of the Indian Bullion and Jewellers Association: It is better to buy gold jewellery 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 about a diamond’s clarity from a government agency like BIS. The government has declared gold as an asset class while diamond still remains a consumable item as it is difficult to get the correct resale value of diamonds through buyback options.
Further, diamond prices are currently falling, and no one knows where the bottom is. From an investment perspective, gold scores over diamonds as one can easily take a gold loan, but banks do not give loans against diamonds. There is now also competition from lab-grown diamonds. Lab-grown diamonds are identical to natural ones. Only those wearing diamond jewellery know whether the diamond is natural or lab grown.
Aditya Modak, CFO & COO of P N Gadgil and Sons: Gold bullion might be a better option from an investment perspective. Even in the case of jewellery, gold jewellery will offer better returns than diamond jewellery. When buying diamond jewellery, you invest approximately 50% in the stone and 50% in gold. Historical data has shown a consistent increase in gold prices over the past few decades, which shows that gold has shown promising results as an investment. However, diamond jewellery provides a unique and secure balance of investment risks. The potential fluctuations in the prices of gold and diamonds work in tandem to stabilise the investment, providing a sense of reassurance about the stability of your investment. Hence, it comes down to personal preference over how the buyer perceives the value of diamonds and gold.Suvankar Sen, Managing Director and CEO of Senco Gold & Diamonds: For consumers seeking a simple, liquid and culturally significant investment this Diwali, gold remains a strong option. With global uncertainties and ongoing conflicts, gold prices are expected to rise, making it a wise choice for long-term value. However, diamonds present an attractive opportunity as well, 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 often face the choice between buying gold or diamond jewellery, both of which hold unique value. With the wedding season around the corner, wedding jewellery is in high demand. Given the current surge in gold prices, many consumers are opting for lightweight, everyday diamond jewellery, which offers both 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 continues to be the preferred choice due to its timeless appeal and cultural significance. However, for everyday wear and social gatherings, diamonds offer a modern, trendy look, making them an attractive option for those seeking both style and long-term value.
Vikas Singh, Managing Director & CEO of MMTC-PAMP: While diamonds fascinate with their brilliance, gold has been standing unmatched as an investment choice for people for ages. Investing in gold offers several advantages compared to diamonds. Gold is highly liquid, with a well-established global market that makes it easy to buy and sell. Its value has been historically recognised as a store of wealth, and it offers long-term stability, especially in volatile markets. Gold is also considered a safe haven during economic downturns, while diamonds are influenced by trends and subjective characteristics like cut and clarity. Additionally, gold is more fungible and cannot be synthetically produced, ensuring its rarity and consistent value over time. In contrast, the emergence of lab-produced diamonds has led to significant price reductions and lower demand in the diamond market, further challenging their investment potential.
Going by the insights offered by these experts it can be concluded that if you have only investment in mind then going for gold alone could be a better choice however diamond has its own appeal which many can prefer due to its utility value as an ornament.
