Hard Assets: The Returns on Rare Diamonds and Gems
AbstractThis paper examines the investment performance of diamonds and other gems (sapphires, rubies, and emeralds) over the period 1999-2010, using a novel data set of auction transactions. Between 1999 and 2010, the annualized real USD returns for white and colored diamonds equaled 6.4% and 2.9%, respectively. Since 2003, the returns were 10.0%, 5.5%, and 6.8% for white diamonds, colored diamonds, and other gems, respectively. Both white and colored diamonds outperformed the stock market over our time frame. Nevertheless, gem returns are positively correlated with stock market returns, suggesting the existence of stock market wealth effects.
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Bibliographic InfoPaper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 2011-056.
Date of creation: 2011
Date of revision:
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Web page: http://center.uvt.nl
Auctions; Diamonds; Gems; Hedonic regressions; Alternative investments;
Find related papers by JEL classification:
- G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
- G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
- Q3 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation
- Z11 - Other Special Topics - - Cultural Economics - - - Economics of the Arts and Literature
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-05-30 (All new papers)
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