In a world where we have recently seen banks collapsing, a transition to a cashless digital society being hotly debated and with cyber security threats more prevalent than ever before, the benefits of buying physical assets has become a very appealing option for many investors.
Central banks have long known the benefits of investing in physical assets, throughout history, gold has formed the backbone of the monetary system, and to this day remains an important asset held by central banks.
Traditionally, we have seen gold values increase with inflation and has long been viewed as a safe haven investment during times of financial uncertainty and as a great hedge against inflation.
The last great run up in gold occurred during the inflationary 1970’s, when stagflation in the USA caused massive inflation and mortgage rates headed for the 20% mark.
During that period, there was a direct correlation between precious metals, diamonds and other coloured gemstone prices. As gold increased in value, so did other tangible assets like investment grade gemstones.
Its ironic that at the time of writing history appears to be once again repeating, as high inflation and rising interest rates are affecting many countries around the world, including Australia.
As a result of these conditions we are are once again seeing all time high prices in gold and strong demand for coloured diamonds and other investment grade gemstones.
What makes naturally coloured gemstones unique is their non-correlative nature to macroeconomic developments. Gemstones will typically experience steady growth even through financial downturns, and it’s because of this non-volatility that make them perfect candidates for hedging and diversifying.
Further evidence of this was seen during the GFC recession in 2009 and the 2020 Covid financial market declines, when international collectors seeked out alternative investment options, pushing the prices for coloured diamonds and other gemstones to record highs at each major auction.
Collectors from around the world have long been aware of the significant role that gemstones can play in conserving capital and protecting wealth, representing an excellent and highly transportable form of personal wealth.
As private collectables, gemstones are also a discreet way of transferring wealth from one generation to the next, with most governments not requiring the ownership of loose gemstones to be disclosed to other authority’s as they are considered personal property.
So when you add it all up, these quality’s make gemstones one the most discreet, convenient and concentrated stores of wealth in the world!
If you also see the benefits of collecting high quality gemstones, Contact Gemrock Investments with your price range or you can review our list of collectable gemstones currently available here.
General Disclaimer:
Any information provided by Gemrock Investments is for informational purposes only, and does not constitute financial advice, either general or specific. You should assess whether the information is appropriate to your individual financial circumstances before making an investment decision.
Gemrock Investments are not financial advisors. You should always seek professional financial advice from your accountant or financial planner before making major financial decisions.
The information provided has been derived from research and sources believed to be reliable. However, no guarantee is expressed or implied as to their validity. Opinions included herein are subject to change without notice.
All investments involve different degrees of risk and you should be aware of your risk tolerance level and your financial situation at all times.
The gem market is speculative and unregulated and certification does not eliminate all risks associated with the grading of gems.
It is also important to remember that previous growth and returns demonstrated from gemstone investments are not an indicator of future growth nor is it intended as an offer or solicitation with respect to the purchase or sale of any security or gemstone.
Gemrock Investments may also own gemstones in areas they feature or discuss.
Gemrock Investments urges you to obtain professional advice before proceeding with any gemstone investment decision.
