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Both gold and diamonds are incredibly valuable. When considering these two items, many people wonder: is gold worth more than diamonds?
The comparative value of gold and diamonds depends on several factors. So, while diamonds may cost more by the ounce than gold, this doesn’t tell us the whole story behind their value. Learn more with our team at The Oxford Gold Group.
You can speak with a highly trained member of our team when you call 833-600-GOLD.
Gold vs. Diamonds: Basic Facts
Before we discuss the value and worth of gold and diamonds, it’s essential to get a firm understanding of these elements.
Learn the Facts About Gold
Gold is a heavy metal and one of the rarer ones found on earth. There are relatively small amounts of gold found throughout the planet, with much of this element sunk towards the planet’s core.
However, we have found gold concentrated throughout the earth’s crust, as well. Miners and companies have been digging this mineral from the ground and using it to make jewelry, coinage, and more for thousands of years.
Gold is a relatively soft metal, which means that many jewelers mix other metals into it to make it usable. Depending upon the concentration of other minerals in the gold, the value of jewelry or coins can vary.
Gold generally has a higher value than many other precious metals, including silver. However, both gold and silver represent solid investment choices. You can consider a gold and silver IRA to learn more about your investment options.
Learn the Facts About Diamonds
Diamonds form when carbon – a very common element – gets exposed to high amounts of pressure over time. First, diamonds form deep inside the earth due to volcanic pressure. Eventually, they get brought close enough to the surface for us to find.
Diamonds naturally continue to form within the earth, making them far less rare than gold. Volcanic pressures inside the planet make these precious stones and push them closer to the surface.
Companies around the world also can create synthetic diamonds. These diamonds are often used in manufacturing processes, as diamonds are one of the hardest minerals we have available in the world.
Manufacturers can also use synthetic diamonds in jewelry and other items. While they are chemically identical to “natural” diamonds, companies often charge less for them.
Gold vs. Diamonds: Which Is More Expensive?
When considering whether or not gold is worth more than diamonds, many people focus on the price tag for each item. Looking at which item is more expensive can provide you with some basic information about worth and value.
Generally, merchants charge more for diamonds than they charge for gold. Let’s review standard prices for both diamonds and gold to learn more.
Standard Prices for Diamonds
The price you pay for diamonds can vary greatly depending upon the quality of the diamond you want to buy. The value of an individual diamond depends upon the stones:
- Cut
- Clarity
- Color
- Carat (or weight)
Diamonds vary in price depending upon their shape or how they reflect light. Flawlessly cut stones generally cost more than stones with even minor imperfections. Jewelers consider all of these factors before putting a price tag on a diamond.
When jewelers price diamonds, they usually charge by carat. Each carat weighs about 0.2 grams, and merchants charge anywhere from $2,000 to $25,000 for a single carat. So, as you can see, diamonds can become very expensive.
Standard Prices for Gold
Gold generally costs much less than diamonds if you compare the two items solely by weight. A single gram of gold costs typically around $55, though the cost of gold fluctuates constantly. You may find gold for more or less than this amount on any given day.
However, consider that diamonds cost around $10,000 a gram, even for a stone with the poorest cut, color, and clarity. Better stones generally cost much more. Therefore, diamonds cost much more than gold on a purely weight-based level.
Is gold worth more than diamonds? When you look only at their relative price per gram, it seems like the answer is “No.” However, there are other factors to consider when you look at gold and diamonds.
Gold vs. Diamonds: Uses in the World
The Uses of Diamonds
Diamonds often cost more than gold, despite the fact that gold is significantly rarer than diamonds. Many investors do not realize that gold is rarer than diamonds because merchants charge so much more for diamonds.
Both natural diamonds and artificial diamonds have higher price points. However, this inflated price point generally comes from market conditions created by large jewelry manufacturers and stores. These companies have the ability to set the price for diamonds where they want.
Diamonds often get used in jewelry, which may lose value quickly once you purchase it. If you’ve ever tried to resell diamond jewelry, you may notice that you get far less than you paid for it upon your initial purchase.
The Uses of Gold
Many merchants also sell gold jewelry, of course. Generally, merchants use 24 karat gold, or gold blended with some other precious metals when they make jewelry. They do this because pure gold is too soft to be used in jewelry making.
Manufacturers also use elemental form gold to make some pieces of medical equipment and specific electronics. Finally, gold has historically served as a currency in some economies around the world.
Previously, the United States used a gold standard to back all of the currency in the country. However, the government did away with the gold standard several decades ago, and you can no longer expect stores to accept gold coins or bullion as payment.
However, merchants and private collectors purchase gold bullion and coins, allowing you to quickly exchange these items for liquid currency. We recommend considering the relative uses of both gold and diamonds when deciding which is worth more.
You can learn more about the uses of gold as an investment by reviewing the facts about a gold IRA. You may also consider investing in a silver IRA to plan for your retirement.
Gold vs. Diamonds: Practical Considerations
You should consider several practical factors before investing in either gold or diamonds, and these factors go beyond the base monetary value assigned to these rare minerals.
Value Fluctuation
Diamonds generally maintain a very steady value on the market. However, they appreciate slowly over time, especially if they have high clarity, color, and cut.
The relative value of gold, on the other hand, often fluctuates greatly depending upon the state of the stock market. Gold has ties to currency, and you can freely trade it. This factor sometimes means the price drops, and in other situations, it skyrockets.
Recent trends have seen the value of gold increase significantly. The experts report that gold’s value increased around 450% over the last ten years. As concerns about the economy continue to present themselves, we expect gold to continue to increase in value.
If the price of gold continues to rise, then investing could earn you money in the long run. Diamonds, on the other hand, maintain a relatively stable price, meaning they help you store your wealth but do not allow you to grow it.
Ease of Trade
You can trade gold on the stock market. However, if you want to sell gold and don’t have a lot of time, you can usually take it to a coin shop or even a pawnshop to get money from your investment, often on the same day.
Diamonds, on the other hand, represent a less liquid investment choice. Most pawnshops do not buy diamonds, and jewelers do not offer set prices for the diamonds they purchase. Instead, each diamond gets a unique price based on its cut and clarity.
You could bring in two diamonds and get wildly different prices for them, or take the same diamond to two stores and end up in the same situation. This detail makes it more difficult for investors to gauge the exact value of their diamonds.
Storage and Transport
Diamonds usually weigh significantly less than gold and take up less space. These factors make it easy to store these precious stones, and you can generally transport them easily. However, it’s not difficult to transport gold coins or bullion, either.
In both cases, the experts recommend investing in security precautions to store your investments. A safe or another security device can provide you with in-home protection, and keeping the safe combination in a secure location provides another layer of protection.
Learn More About the Relative Value of Gold and Diamonds
Is gold worth more than diamonds? Generally, merchants charge more per gram for diamonds than gold. However, gold is rarer than diamonds and may increase more in value over time, making it an excellent investment choice.
You can learn more about the benefits of investing in gold with the Oxford Gold Group. Find out more by calling 833-600-GOLD.
