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Gold Engagement Rings May Become More Valuable Than Diamonds

Gold engagement rings, and gold pieces in general, are likely to see a higher increase in value over time than their diamond counterparts, an Indian specialist recently revealed in a piece for NDTV Profit.

In an article published last month, Raghu Kumar explains that diamonds have been artificially marketed to appear more valuable than they are, and that gold would always be a better investment and more likely to stand the test of time. Couples are therefore advised to invest in gold engagement rings if they are looking for assets in the long run.

To proove his theory, Kumar used his own local example of India, quoting the importance of gold within that culture and presenting the country’s import and export figures for that precious metal in 2012. The findings were impressive: India consumes nearly six times as much gold as the United States, with the metal pervading, according to Kumar, all the strata of Indian society.

The specialist then goes on to state that gold is a perennially safe and solid investment, which has retained its value throughout time and provided an annualised return of nearly 18 percent between 2001 and 2012. The fact that, unlike diamonds, this precious metal cannot be artificially produced only increases its worth, making gold the great equaliser in times of financial crisis. Relatively stable prices and a reasonably liquid market are other reasons to invest in gold, the Indian economist concludes.

Diamonds, on the other hand, should be purchased merely for their aesthetic appeal, and never regarded as sound investments, Kumar says. This is because diamonds depreciate over time, and the market for them is less than liquid. Furthermore, they vary wildly in quality, colour, size and carat, making it difficult to find similar types with any sort of frequency or to estimate the value of any given specimen upon purchase. Finally, diamonds can easily be generated in a laboratory and they also have a poor re-sale value, which also contributes to decreasing their value as a financial asset, the analyst considers.

Kumar concludes by stating that, unlike gold, diamonds are a relatively recent fad and they were only marketed as luxury items from 1938 onwards. Therefore gold, regarded as the perennially valuable, time-tested material that has a stable market, is considered to be the best option when looking to invest for the future.

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