Diamonds vs. precious metals: what shines brightest in your investment portfolio?

Low, Rand Kwong Yew, Yao, Yiran and Faff, Robert (2016) Diamonds vs. precious metals: what shines brightest in your investment portfolio?. International Review of Financial Analysis, 43 1-14. doi:10.1016/j.irfa.2015.11.002

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Author Low, Rand Kwong Yew
Yao, Yiran
Faff, Robert
Title Diamonds vs. precious metals: what shines brightest in your investment portfolio?
Journal name International Review of Financial Analysis   Check publisher's open access policy
ISSN 1057-5219
1873-8079
Publication date 2016-01-01
Year available 2015
Sub-type Article (original research)
DOI 10.1016/j.irfa.2015.11.002
Open Access Status File (Author Post-print)
Volume 43
Start page 1
End page 14
Total pages 14
Place of publication Amsterdam, Netherlands
Publisher Elsevier
Language eng
Abstract Several studies explore the use of gold and other precious metals for protecting investors’ wealth during periods of market turmoil. However, alternative investments, although increasing in popularity, still remain unfamiliar to the majority of investors. We explore the safe haven and hedging properties of diamonds versus precious metals in an international study to evaluate diamonds as a viable investment alternative. Furthermore, we compare the performance between the returns of physical diamonds and diamond indices. Our analysis indicates superior performance by precious metals compared to diamonds. However, investors enjoy greater benefit from directly investing in physical diamonds rather than diamond indices. For investors looking to protect their assets against highly volatile market conditions, precious metals remain a better option. Investors should continue to keep abreast of developments with the evolution of the diamond investments industry and physical diamonds can be included in a portfolio for their downside diversification potential.
Keyword Diamonds
Gold
Gold
Hedges
Precious metals
Safe haven
Q-Index Code C1
Q-Index Status Provisional Code
Institutional Status UQ

Document type: Journal Article
Sub-type: Article (original research)
Collections: Official 2016 Collection
UQ Business School Publications
 
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Citation counts: TR Web of Science Citation Count  Cited 5 times in Thomson Reuters Web of Science Article | Citations
Scopus Citation Count Cited 6 times in Scopus Article | Citations
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