Sales Strategy

Can ETFs Help Strengthen Jewelry Retail Strategies? March 25, 2025 (0 comments)

New York, NY--Jewelry retailers face a challenge: convincing consumers that natural diamonds hold long-term value, especially with lab-grown alternatives becoming more common. One possible solution is a diamond exchange-traded fund (ETF).

[Image via istockphoto.com]

According to Diamond Standard Co., a diamond ETF would position natural diamonds as investment assets, similar to gold or silver. This could give consumers confidence that their purchases are not just luxury items but appreciating investments. This shift could strengthen the value proposition for natural diamonds, especially compared to lab-grown stones, which typically depreciate sharply.

How the Diamond ETF Works

The diamond ETF will function as a commodity-holding corporation in North America, Europe, and the Middle East. Diamond Standard Co. plans to acquire $400 million of polished diamonds from mines and vendors to back the ETF. The goal is to create a regulated, tradable financial product similar to gold or silver ETFs.

The company notes that gold ETFs previously boosted gold's market price and turnover by two to five times. A similar effect is expected for natural diamonds, as the ETF allows investors to treat diamonds as a legitimate asset class, increasing both demand and perceived value.

What It Means for Retailers

Retailers could benefit from the ETF by positioning natural diamonds as appreciating assets, giving consumers more confidence in their purchases. The ETF is also expected to help retailers sell at a premium rather than a discount, stabilizing market prices.

According to Diamond Standard Co., participating retailers will have the right to sell diamonds to the ETF for three years, securing a consistent sales channel.

See more in this video by Diamond Standard Co.