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Gold vs Diamond vs Platinum: Which ones are worthwhile as an investment class?

By Finserv MARKETS - Aug 2,2019
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Gold vs Diamond vs Platinum: Which ones are worthwhile as an investment class?

Since the profitability of investments is essentially dictated by market forces, different instruments are ideal as investment classes at different points in time. The concept of trading itself is based on demand and supply, so a large part of which investment classes is worthwhile depends on how the demand for the commodity is faring. When there is too much supply of a particular commodity as compared to the demand for the same commodity, prices tend to crash. Metals, especially gold, have long been considered as a secure investment owing to their relatively low price volatility on a daily basis.

Trading of gold has now moved online, with companies like Finserv MARKETS facilitating the buying and selling of physical gold through online mediums. An account with Finserv MARKETS allows you to hold the digital gold you buy in an online account until you are ready to redeem it, at which point it will also be delivered to you. Invest in gold on Finserv MARKETS today, and save costs on holding the gold in a locker. Additionally, by investing in digital gold, you are also saving yourself from the worries of burglary and theft that come along with holding a large amount of gold.

Even as gold’s popularity continues to soar within investment circles, other metals like diamond and platinum have also come to the forefront. Continue reading to learn the pros and cons of these precious metals, and see for yourself how investing in digital gold on Finserv MARKETS can help you achieve better returns on your portfolio.

  • GOLD

Properties of gold as a metal include that it does not rust or corrode, is malleable, and has superior ability to conduct both heat and electricity. Though it has some industrial applications, is largely used as a base for currency and jewellery. Central banks all over the world also use gold reserves as a form of investment. However, as an investment class, demand for gold is determined by sentiment more than supply and demand principles. Since the supply of new gold mined is much lesser than the amount of gold held by individual hoarders, the price of gold falls when hoarders feel like selling.

Demand for gold is primarily driven by its ability to act as insurance during the following situations:

  1. When markets appear unstable owing to unstable economic conditions, or banks’ interest rates seem unattractive, gold emerges as the investment class of choice in terms of security
  2. Inflation causes equity and debt markets to dip, and gold emerges as the safest choice for investment owing to the tangible value it holds for investors
  3. War and political instability have always led people to hoard gold since the metal’s value will not diminish
  4. Some people also prefer to invest in gold over equity and debt, owing to the ease with which gold can be bought, as opposed to picking out the right stocks to trade in. With Digital Gold being available on Finserv MARKETS, it is now easier than ever to buy and sell gold. Despite these factors, investing in gold also has certain cons such as there is no yield value, relatively lower capital gains, and difficulties in storage. Storing gold does not lead to an increase in its value, which is not true for shares where you can earn dividends.
  • PLATINUM

Platinum is a precious metal sourced mainly from South Africa and Russia. It has gained popularity in investment circles, but the demand still rages over whether it is as good an investment class as gold. Continue reading for pros and cons, and decide for yourself whether you should invest in gold or platinum:

  1. Platinum is easily liquified, and you can always exchange it for cash.
  2. It has risen steadily in price, which has made it appear as a safer investment class. While the value of gold is highly dependent on the US dollar, platinum is not entirely dependent on it – making it a safer investment
  3. Increase in demand for platinum within the industrial sector will lead to an increase in its prices.

Platinum is a recent addition to investment circles, which often makes people hesitate before they risk their money investing in platinum. Since it has a high spot price, it can be unpredictable to a certain extent. Storage and security of platinum warrants extra expenditure; which is not necessary if you invest in Digital Gold, available on Finserv MARKETS. The gold you buy can be stored online, and once you put in a request for redeeming it, you need to choose whether you want physical gold in coins or bars; and it will be delivered to your doorstep.

  • DIAMONDS

Diamonds emerge as an attractive choice of investment when people wish to have tangible assets that they can also use. Diamond jewellery is one of the most popular ways for people to utilise their investment into this precious metal.

  1. Unlike equity investments, diamonds allow people to understand what they are getting. It is a tangible asset that is recognisable across the globe for its value. As a precious metal, it also holds great value as a family heirloom that can be passed down from one generation to another.
  2. It is a highly liquid investment class. Anytime there is a requirement for urgent cash, a diamond can be sold and turned into cash almost immediately.
  3. Mine output for diamonds is dropping, while the global population is increasing; which leads to greater demand and lesser supply.

However, investing in diamonds give rise to risks such as a purchase from a fraudulent company and a lack of certification. Investing in diamonds from a company that is not reputable can be disastrous in terms of resale value. Digital Gold, available on Finserv MARKETS, not only insured but is also 24 karat gold and 99.5% purity certified gold.

Now that you are aware of the pros and cons associated with gold, diamond and platinum as investment classes; you are in a better position to decide for yourself what your next investment should be like. The biggest con of investing in precious metals is regarding its safe storage. With Digital Gold, available on Finserv MARKETS, that concern is also eradicated. Invest in gold online and you need not ever worry about its storage until you decide to get it redeemed as physical gold. Download our investment app to find the best ways to grow your money and expand your investment portfolio.

“Finserv MARKETS, from the house of Bajaj Finserv, is an exclusive online supermarket for all your personal and financial needs. We understand that every individual is different and thus when you plan to achieve your life goals or shop for the gadget of your dreams, we believe in helping you Make it Happen in a few simple clicks. Simple and fast loan application processes, seamless, hassle-free claim-settlements, no cost EMIs, 4 hours product delivery and numerous other benefits. Loans, Insurance, Investment and an exclusive EMI store, all under one roof – anytime, anywhere”!

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