Diamonds Will Shine in a World Without Income
It’s been another interesting week in investment markets, with equities in the United States continuing to bounce. The continued spread of COVID-19 is of course a concern for investors, though for now they are obviously comforted by central bankers and politicians that continue to offer a combination of monetary and fiscal stimulus, as well as direct intervention in asset markets.
Whilst these trends will likely stay in place for some time, we think astute investors should be rotating into hard assets like pink diamonds now, with the real economy itself continuing to crumble.
There was perhaps no better illustration of that in Australia this week than the decision by Westpac, one of our big 4 banks, to suspend its dividend. The market’s reaction was quick, and brutal (see chart below), with the company falling 3.4% in early trading on Tuesday 18th August, as investors dumped the stock.
Diamond Market Activity Heating Up
This week’s update looks at recent reports on the increased activity being seen in the global diamond industry, which like many other industries, has been severely impacted by COVID-19.
More importantly, we share our view on how these developments will impact the investment market for pink diamonds going forward.
We also share another warning sign from the stock-market, which will have astute investors worldwide looking to diversify their wealth and move some of their assets into alternative hard assets, like pink diamonds.
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