Have You Ever Tried To Sell A Diamond?

This title is ripped of an article by Edward Jay Epstein in 1982. Its lengthy, good read but I didn't find time for it. It many held an experiment where he tried to sell a diamond into the secondary market. This article proved that diamonds is not good as investment unless you belong to the cartels setting the price or it's limited edition stuff. Store bought diamonds are typically overpriced for markups and profit margins of the retailers and many more up the chain.

This article's title alone, if self-wondered, already answer the big question should you buy diamonds as investment. This title alone thought me to always remember my position in all my investments.

By 'Position', I meant: what are you? And, who are you?

In this instance, before even thinking about investing in diamonds (if you even call it investing), think first. Are you part of the cartel that sells diamonds?

More often than not, you aren't. Simply think of it this way: generic items have a price limit. You cannot sell generic Toyota at a Mercedes price. That's it. And every single Toyota you buy from the showroom, is already priced at a point where maximum profit is included inside (no way Toyota will say, lets price it a little cheaper so that the owner can sell the car for a profit later.)

Its the same thing with diamonds, why would Jewelry shops price the diamond for you to make a profit when you sell it? Are they in the charity business?

The same goes for gold that you find in shops, there is no way it will be worth your while unless you intend to hold them for decades and sell it as old gold. Then again, the gains in these prices may just well be eaten away by other things such as inflation, currency and so on.

Always remember your position. 9 out of 10 times, we are just a regular person, living regular lives. We are not in the know, we are within and without. Remember the limit of pricing I mentioned earlier? For any single diamond you purchase, it was already priced to its limit and maybe more. There is no way, you can own a single diamond and sell it at a profit unless you dig it up yourself, cut the faucets and polish it to bling shine. With the exception of it being a collector's grade gemstone.

A Diamonds is Forever overpriced.

There you have it, the article seems to offer more insight, but its lengthy, but good nonetheless. Anything you think you are investing in, never be impulsive (courage and impulsiveness is just a fine line divided by intellect and homework done by investors). Unless you are in the inner circle, these hot stocks are merely just a thin sheet of paper holding alot of hot air.

For myself, I'm just a guy behind a computer, I am not in the position to get hot insider news.

Looking at Keppel Land
Without being too technical, Jan to Feb, the prices was surging like crazy driven by news of  Keppel Corp privatising it. Announced somewhere on the 21st Jan morning times. At which point do you think you are able to cash in on this event?

There is always a limit to price. The inner circles would have already taken out such a huge chunk and cashed out even before you got in, you might even be disappointed in the end of it all and those unfortunate ones might even be not making any money after brokerage and what have you.

Unless you own Keppel Land's share before 21st Jan, most likely, you will not be able to make any sizable profit out of this.

A good read is Tulip mania, funny though Gardens by the Bay decide to use this name to name one of their events, I hope they know the story behind this name.