Diamond Jewellery vs. Gold: Which Is the Better Long‑Term Investment?

Agustus 02, 2025

Whether you’re saving for a rainy day or planning legacy wealth, both diamond jewellery and gold have long been associated with stability, prestige, and preservation of value. But which holds up better in today’s financial landscape? With evolving markets, technological disruption, and shifting consumer preferences, the investment merits of each asset differ significantly.

This deep dive compares both—covering market trends, resale potential, risks, and emotional appeal—to help you decide which one suits your long‑term wealth strategy.

📈 Performance Over Time

Gold: A Proven Safe‑Haven

Gold has delivered average annual returns of 7–11% over the past 50 years, with a cumulative gain of around 547% over the last 25 years. More importantly, gold benefits from price transparency—market rates are updated daily, and standard qualities (e.g. 24K, 22K) trade globally.

Diamonds: Steady but Slower Growth

Diamond prices (especially investment‑grade stones) have risen at a slower pace—often around 5–7% annually, with total growth near 200% over recent decades. The market growth is more modest, but historically more stable—less volatile than the swings of gold.

💎 Valuation: Objective vs Subjective

Gold: Weight and Purity

Gold’s value is based on weight (troy ounces or grams) and purity (e.g. 24K or 22K). Its pricing is standardized worldwide and easy to verify, which translates to predictable liquidity and minimal bid‑ask spreads.

Diamonds: The Complex 4Cs

Diamonds are valued via the Four Cs—cut, clarity, color, and carat—plus brand provenance, certification, and rarity. This makes pricing highly subjective and opaque, increasing resale uncertainty.

💧 Liquidity: How Easily Can You Cash Out?

Gold: Highly Liquid

You can easily convert gold into cash—via bullion dealers, banks, and ETFs—almost anywhere on the planet, often at minimal loss.

Diamonds: Illiquid and Niche

Diamond resale is far more complicated:

Values vary by stone and market.
Dealers may offer 20–50% less than retail on even high-quality stones.
Selling often involves auctions or consignment to specialty buyers.
No universal price index exists (unlike gold)

If you need liquidity fast, gold wins hands down.

📦 Storage and Maintenance Costs

Gold: Low Maintenance

Little to no upkeep.
Can be stored as coins, bars, or ETFs with minimal expense.
Tax‑advantaged options available in some regions.

Diamond Jewellery: Higher Overhead

Requires appraisals, insurance, periodic inspection.
Retail markups, cleaning and potential repair costs add up.
Storage costs for vaults or safety deposit boxes also factor in.

🛡️ Inflation Hedge & Crisis Resilience

Gold: Traditional Hedge

Widely considered a core hedge against inflation, currency devaluation, or geopolitical instability. Central banks hold gold reserves as a financial anchor.

Diamonds: Value in Scarcity

High-end natural diamonds—especially rare colored stones—can preserve value over decades, even during downturns. Their appeal lies in their rarity and demand among luxury consumers. But they lack standardized trading mechanisms and are less recognized as mainstream safe‑haven assets.

🌐 Market Trends in 2025

Gold Demand Soars

In mid‑2025, gold demand rose sharply—global value surged 45% YoY to a record $132B. Prices climbed above $3,300 per ounce, fueled by volatility and inflation. However, jewellery demand dipped 14%, particularly in gold‑loving markets like China and India.

Diamonds Facing Disruption

Lab-grown diamonds now dominate production in China (>70%). Prices for synthetic stones fell as low as 7% of natural equivalents.
Natural diamond prices dropped 26% from 2022 to early 2025, largely due to oversupply and reduced consumer demand in China and India.
Still, rare, graded natural diamonds hold strong appeal for investors seeking scarcity and provenance.

🧾 Expert Insights

Gold

Gold’s predictability and transparency make it the default asset in crises.
ETFs and futures give easy exposure without physical handling.

Diamonds

GIA-certified, investment-grade diamonds (D–F color, IF/VVS clarity, 1+ carat) are likelier to retain value.
Branded or heirloom diamonds (e.g., Cartier, Tiffany) resale better than generic pieces.
But others (e.g. small, unbranded stones) often lose value within months of purchase.
Lab-grown diamonds attract younger buyers—but lack long-term investment strength.

✅ Pros & Cons Summary

Gold

Pros:

High liquidity
Transparent pricing
Strong inflation hedge
Low maintenance
Globally recognized

Cons:

Some volatility
Less emotional or aesthetic appeal