Diamonds have captivated men and women alike all around the globe since their discovery, which partly explains why we have always strived to acquire these precious stones and by all means necessary.
Furthermore, diamonds constitute a remarkable investment product for more practical reasons:
Diamond mines are becoming scarce, and diamonds cannot be produced artificially. According to Bain& Company’s Global Diamond Industry Report, maximum global productivity of all diamond mines will be reached by 2030, while concurrently diamond demand will grow by 6 to 8% each year.
Diamonds may be small but highly precious nonetheless. In fact, it is quite extraordinary how such small volumes can bear such high value. For example, a diamond weighing 0.2 grams, or 1 carat, is as high in value as one kilogram of gold (approx. 32 troy ounces).
With the ever-growing demand for diamonds, the value of these precious stones will also continue increasing until all resources on Earth will have depleted, that is to say in about 20 years.
In conclusion, diamonds constitute an excellent investment product, on the condition that they present certain specific characteristics. These are assessed by independent certification laboratories on the basis of the 4Cs
What do the 4Cs refer to?
The 4Cs are the four main characteristics that determine the value of a diamond. Each letter C stands for a specific term in English.
The weight of a diamond is expressed in carats. Investment diamonds generally weigh between 0.5 and 2 carats.
The most sought-after diamonds are transparent in color, making them also the most expensive diamonds on the market; nevertheless, diamonds can range between a broad spectrum of colors, from yellow to blue, and finally red.
Diamonds must be free of impurities and blemishes that might dull their brilliance and sparkle.
This criterion is not intrinsic to diamonds but is rather based on their cut. The cut of the diamond is what will highlight the stone’s brilliance and fire. Naturally, the diamond’s symmetry must be perfect as well.
Why invest in diamonds?
There is no doubt as to how prestigious and exceptional diamonds are; what is more, in any market system, everything exceptional has market value, as do other investment products such as stocks or currencies.
However, unlike other investment products, diamonds are physically real and have a standard exchange value. For example, company stocks can drop dramatically to no value; similarly, currencies can also depreciate to very low value. However, no such depreciation is possible as to the value of a diamond.
Moreover, their advantageous taxation requirements and low storage and maintenance costs make diamonds a genuinely attractive investment!
With DIAMOND PRIVILEGE unprecedented services, you will have access to many more attractive investment possibilities than those usually offered to traditional investors.
We will guide you through the entire process, from your choice of diamonds to all taxation and legal matters involved.
Investment diamond taxation
How is VAT applied?
VAT applied for diamonds is the normal rate for luxury goods, namely 20% in France.
Beware of brokers who offer the acquisition of diamonds without paying VAT, which means without issuing an invoice. This practice is entirely illegal, and the penalties can be heavy both for you and the seller.
What is the tax treatment of investment diamonds?
Unlike diamonds mounted or set in jewelry, investment diamonds constitute a good financial investment. Indeed, the differential value obtained between the purchase price and the resale price (the spread) is considerable, whereas jewelry is not usually intended for resale.
Since 2014, diamonds fall under the category of jewelry and equivalents, meaning loose diamonds that are not mounted in jewelry settings.