Lab grown diamonds are produced in a controlled laboratory environment. Unlike their organic counterparts, lab grown diamonds don't spend centuries hidden in rocks before miners finally discover them.
But interestingly, a lab grown diamond has the same physical and chemical properties, so if you're wondering whether your diamond pendant is natural or lab created, you may need help from an expert to tell the difference.
Interestingly, lab created diamonds are generally less expensive than natural diamonds, making them a great option and an affordable substitute for wedding day diamonds, engagement rings, etc.
However, do lab grown diamonds fare equally when it comes to investment options? While natural diamonds may be an excellent option for investments, investors are generally skeptical about buying lab created diamonds to secure their finances and profit from them.
So, in this post, we will talk about some of the basics you should consider if you want to make money with lab grown diamonds.
Should You Buy Lab Grown Diamonds for Investment
Whether natural diamonds or lab created, buying them from an investment point of view is essential. So, even if you're gifting diamond jewelry or a solitaire ring, it will still be expensive, regardless of the diamond you choose.
Therefore, you must ensure that your diamond jewelry holds a decent investment value. Hence, buying your diamonds carefully can help you in the long term and help secure your finances while you flaunt your diamond jewelry at weddings and other occasions.
Do People Know About Lab Created Diamonds?
Recent reports suggest good numbers for lab grown diamonds. Only twelve years ago, the consumer base aware of synthetic diamonds was less than 10%. However, this number has grown substantially in the last decade, as more than half of the consumers were keen on buying artificial diamonds in 2018.
These numbers are astonishing, given that brands didn't emphasize marketing lab grown diamonds. Moreover, given that most consumers prefer mined diamonds, it's quite a motivating sign for man-made diamond investors as its market continues to expand.
Factors that Affect the Value of Lab Grown Diamonds
The value of lab grown diamonds depends on various aspects. Different elements directly impact the initial and reselling price of synthetic diamonds. Since these diamonds are created artificially, it is believed that the synthetic diamonds may not be as valuable as original stones.
For investors, it's quite critical to understand what factors affect the value so that they can pick suitable types of diamonds. So, here are some essential elements that affect the value of a lab created diamond.
1. Diamond Rarity
The best thing about man-made diamonds is that you can make them in whatever shape and size you like. There is special equipment involved that basically makes these diamonds in whatever shape and sizes you desire.
Unfortunately, the same is not the case with mined diamonds because miners don't know what's hidden under the earth for centuries.
Hence, some mined diamonds don't hold as much value. However, thanks to their artificial creation, you can control the clarity, size, and shape of the diamond, which allows you to create rarer and more valuable diamonds.
In a way, you can buy a relatively cheaper version of rare diamonds, which can be a decent investment option.
2. Value of Lab Created Diamonds
Potential investors are only skeptical about one thing, the resale value of the diamonds. It's perhaps the only thing that keeps new buyers from entering the lab grown diamond trade business. When compared with natural diamonds, synthetic diamonds have 30% less value for the same size and other properties.
One important aspect here is that the popularity of lab grown diamonds is continually growing, and it's set to rise in the next few years. That's because of the evolving production technology and people's interest in these diamonds.
But eventually, the number of lab diamonds will decrease to maintain their market value. And since lab diamonds are so easy and fast to produce, they will likely compete well with organic diamonds.
Hence, now is the right time to invest in lab created diamonds with a potential rise in diamond value in the future.
3. Resale Value
The resale value of synthetic diamonds is less substantial than that of the real ones. It's got more to do with the production techniques. For instance, if you buy a synthetic diamond and resell it after a long time, a new diamond with the same features could be bought for a comparable or even lesser price.
And since the production techniques continue to evolve, the market for lab grown diamond jewelry will continue to expand, giving consumers more buying options. As a result, buying jewelry with new diamond styles, shapes, and cuts will be more accessible and convenient for consumers.
4. Ethical Bounds
Buying lab grown diamonds is also an ethical choice because of the way they are produced. Natural diamonds require intense mining procedures, which involve the use of heavy machinery, underpaid miners in harsh conditions, and overly exploited mining sites.
However, as we're moving into the era of sustainability, investing in lab grown diamonds is an obvious choice.
Lab grown diamonds are produced in controlled environments with sustainable practices, such as the use of renewable energy, etc. Hence, the carbon footprint is substantially lower; therefore, it's an environmentally-friendly choice for interested buyers.
You can wear your diamond solitaire ring and tennis bracelets without feeling guilty from where it's originated.
5. Similarity with Real Diamonds
Lab grown diamonds can closely mimic natural diamonds in properties, clarity, size, cut and shape. Thanks to a controlled production process, creating a diamond of any type and cutting is easy, and the finished product will be just as brilliant and sparkling as the naturally-mined ones.
It means you can flaunt your lab grown engagement ring as good as real diamond wedding rings. These diamonds are aesthetically pleasing and create the same effect but at a relatively lower cost.
Lab grown diamonds are so close to natural diamonds that you cannot figure out the difference with the naked eye. Since they cost relatively less, investing in these diamonds can benefit you in the future, given that you keep them for at least five years or so.
Whether it's wedding rings, engagement rings, pendants, or any other wedding jewelry, you can add lab grown diamonds of any shape size, or cut, and create a similar aesthetic appeal.