Gold and diamonds are very valuable materials. These two materials are usually used together to make jewellery but when it comes to which of these is more valuable than the other is a question that a lot of people wonder.
Diamonds may cost more than gold by the ounce but that is just one part of the story.
Before directing the value or what each of these material is worth we need to get a good understanding of the two elements.
Facts About Gold
Gold is a rare heavy metal that is available in relatively small amounts throughout the globe. Much of the element has sunk deep inside the planet’s core. There is a sizeable amount concentrated in various areas of the globe. People have been digging for gold for millennia to make jewellery and coins.
Gold is a soft metal, which means that it has to be mixed with other metals go make it durable. The purity of a gold product depends on how much gold is in it relative to the amount of metal alloys. Gold has a high value than other precious metals like silver. Gold and silver are regarded as solid investment choices.
Facts About Diamonds
Diamonds are formed when carbon is exposed to high pressure over some period. They form in the earth due to volcanic pressure. They eventually vet pushed up to the surface so we can mind them.
Unlike gold, diamonds continuously get formed within the earth. This makes them less rare than gold.
Apart from that, diamonds can be created by synthetic means. These diamonds are often used in manufacturing processes because they are the hardest minerals known to mankind. These synthetic diamonds can also be used in jewellery. Synthetic diamonds might chemical be the same as natural ones but they often cost less. Gold cannot be created by synthetic means. However, gold can be recycled from old jewellery, dental fillings and electronic devices like cellphones and laptops.
So which is more expensive?
When considering whether to buy gold bullion or diamonds people look at the price tag. That is just the value of the item and what it is worth.
Gold has intrinsic value. It can be seen as money and in some countries where hyperinflation has decimated the currency, gold is used as an alternative.
When you buy gold bullion, what you’ll pay for it depends on the spot price. The spot price depends on as number of things from political risks to market sentiments
The price of diamonds is based on the quality just like gold. Quality is evaluated differently for both elements. Diamonds are valued according to the 4 c’s: Cut, colour, clarity and carat. Flawlessly cut diamonds with a high carat value can be expensive.
If you compare gold and diamonds by weight, diamonds might cost more. On average the price of a gram of gold is around $60 Whilst a gram of flawlessly cut diamond can cost as much as $10,000.
When you look at it like that gold costs less than diamond. However, when you buy gold bullion you should note the practicality of buying gold and the long term value.
Value fluctuations
Diamonds maintain a steady value. The price of gold on the other hand fluctuates depending on the state of the economy and the stock market. Gold is tied to the currency markets which means you can trade with it. This also means the price goes up or down relative to the value of currencies.
Gold has been on an upward trend. Over the last decade the value of gold has gone up by over 450%! Diamonds may be a girl’s best friend ban it looks nice on your finger but you can’t use them to trade, store or transport. When faced with the choice between gold and diamonds as a wealth protector, you are better off investing in gold because it is rarer, more liquid and its value can increase significantly over time.
