P566ORACLE 566 Mon10 Feb C4 1712:31
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THE A-Z OF
INVESTMENTS
J is for investing in jewels
On 14th November 1984, in Geneva,
Christie's sold the 49.92 carat Terest-
chenko blue diamond for $4,580,000.
Despite this record price that queen of
jewels, the diamond, has hardly been a
girl's best friend in the last 5 years.
In 1980 the prices fetched by polished
diamonds plummetted. Investors who'd
bought when the market was at its peak
in the late 70s found their diamonds
worth around a third of what they paid
Prices are still depressed today.
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CLASSIFIED INDEX *** 490
P566ORACLE 566 Mon10 Feb C4 1713:14
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THE A-Z OF
INVESTMENTS
In the last 15 years diamond prices
have fluctuated dramatically. The late
1970s saw the price of rough diamonds
more than double, with some polished
stones fetching 5 times what they had
in 1970. But what comes up must come
down. The price of a 1 carat flawless
diamond might have moved from $1,000 in
1970 to $63,000 in 1980 ─ but its value
would only be about $10,000 today.
Judging whether a diamond has been a
good investment can be tricky. Unlike
with gold there is no standard price
printed in newspapers. Selling diamonds
means taking time to shop around for
the best price.
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P566ORACLE 566 Mon10 Feb C4 1713:18
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THE A-Z OF
INVESTMENTS
Being able to tell a good quality gem
is vital, so investing in diamonds is
definitely not a game for amateurs.
The professionals grade diamonds accor-
ding to the 4 Cs ─ colour, clarity, cut
and carats. Colour is graded from D to
J. The whiter (or more colourless) the
diamond the better. A flawless example,
with nothing to stop the light passing
through, would be graded I.F. for
clarity ('internally flawless'). The
The weight is measured in carats ─ 1
carat equalling 1/142 of an ounce ─ and
the usual size of an investment diamond
is between ½ and 2 carats.
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P566ORACLE 566 Mon10 Feb C4 1704:55
4/6
THE A-Z OF
INVESTMENTS
Opt for loose stones rather than jewel-
lery when buying diamonds for invest-
ment. A jeweller's markup and the price
for designing the setting can double
what the stone alone would cost. You
might have to wait a long time before a
rise in the resale value of the diamond
would cover this. The setting may even
have been designed to disguise a flaw.
Always buy from a reputable dealer and
make sure your diamond has a certific-
ate of given quality from a reputable
laboratory. Be wary if the dealer
offers a knock-down price or promises
to buy the diamond back whenever you
want to sell.
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P566ORACLE 566 Mon10 Feb C4 1712:19
5/6
THE A-Z OF
INVESTMENTS
There are a number of diamond invest-
ment companies that offer advice and
will do the buying and selling for you.
With some you need never see the diam-
ond ─ they will store it for you, seal-
ed in a plastic envelope, in a Channel
Islands bank. By keeping it outside the
UK mainland, VAT can be avoided.
Most require you to spend a minimum of
£500 to £4,000 and charge a commission
either when you buy or resell your
diamond. This varies between 10-15% of
the stone's valuation ─ though the
percentage may be lower with a more
expensive diamond.
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P566ORACLE 566 Mon10 Feb C4 1704:14
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THE A-Z OF
INVESTMENTS
If you do want to invest in diamonds,
don't tie up money you might need
quickly. Diamonds really can be forever
when you're waiting for a buyer
prepared to pay a decent price.
Which? magazine bought some diamonds in
1970,to see how they'd do as an invest-
ment. 'A sure-fire way to lose money'
is its verdict. In fact, when the dia-
monds were offered for sale last year,
the worst offer was less than the maga-
zine paid 15 years earlier. The money
would have done better in a building
society ordinary share account!
Next week: K is for Kid's accounts
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Your Money ...560 Feature ...567