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Top 5 Diamond Stocks To Buy

People always say "diamonds are forever". So let’s take a look at some of the top diamond stocks to add to your portfolio.
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Diamond stocks are a hidden gem in the investment world. In fact, chances are you’ve probably heard the phrase “diamonds are forever” at some point in your life. And there’s definitely some truth to this famous saying. Diamonds and diamond jewelry are incredibly durable.

Beyond their durability, diamonds have stood the test of time when it comes to trends and value. Diamond jewelry has remained popular and stylish while other trends have come and gone. And a high-quality diamond will always be valuable.

So, maybe it’s time investors start looking to this timeless stone to strengthen their portfolios. Let’s take a look at some of the top diamond stocks to buy today.

Best Diamond Stocks to Buy

Global diamond production increased by almost 12% year-over-year (YOY) to 120 million carats in 2021. Although, overall production levels fell short compared to recent years. This can be attributed to factors like major mine closures.

However, despite somewhat disappointing production levels, the value of the diamonds produced was high. In fact, the average value of global diamond production was $116.53 per carat, a record high.

Some of the best diamond stocks to help you get a piece of this action include:

  • Rio Tinto (NYSE: RIO)
  • Anglo American (OTC: NGLOY)
  • Gem Diamonds (OTC: GMDMF)
  • Lucara Diamond Corp (OTC: LUCRF)

As you probably noticed, all but one of these diamond stocks trade over-the-counter (OTC). And this comes with its unique set of risks. However, most of these companies are internationally based and trade on other major foreign exchanges.

Rio Tinto

The first up on our list of the top diamond stocks is Rio Tinto. And for anyone familiar with the mining industry, this shouldn’t be a surprise. The firm, based out of England and Australia, is the world’s second-largest metals and mining company. It owned the famous Argyle mine, one of the the world’s top diamond producers. However, mining stopped there in 2020.

Its diamond production now comes from the Diavik mine in Canada, which it has 100% ownership of. This mine produced 5.8 million carats of rough diamonds in 2021. Rio Tinto built a wind farm to generate renewable energy to support this mine. That makes Diavik one of the only hybrid wind-diesel mining operations in the world.

Rio Tinto is a founding member and one of the first mining companies to be certified by the Responsible Jewellery Council. This organization encourages responsible and ethical practices throughout the platinum, gold and diamond supply chains. Although it lost some of its output from the Argyle mine, Rio Tinto remains one of the best diamond stocks out there.

Anglo American

Anglo American is a multinational diamond company based out of London. But diamonds aren’t its only output; it’s also the world’s largest producer of platinum. However, its ownership of the De Beers Group is what makes it one of the top diamond stocks.

The De Beers Group is one of the largest diamond companies in the world, and Anglo American owns 85% of it. De Beers produces about a third of the world’s rough diamonds by value. It has mining operations in Botswana, Canada, Namibia and South Africa. These mines have a combined estimated production of between 32 and 34 million carats in 2022.

But Anglo American isn’t just a diamond mining stock. De Beers also sells polished diamonds and jewelry through its brands, De Beers Jewellers and Forevermark. This gives investors exposure to not only the mining sector of diamond production, but also the finished consumer goods.

Gem Diamonds

The next diamond stock is another British company, Gem Diamonds, which was founded in 2005. It’s a smaller company, with mining operations focused only in Lesotho out of the Letseng diamond mine.

Gem Diamonds owns 70% of the Letseng mine. This mine’s claim to fame is that it has the highest dollar value per carat of any diamond mine. In fact, four of the 20 largest known white gem quality diamonds have come out of this mine. The largest was the 910-carat Lesotho Legend which sold for $40 million in 2018.

This company has produced no shortage of incredible diamonds over the years. And if the Letseng mine keeps recovering large high-quality diamonds, this will definitely be a top diamond mining stock to watch.

Lucara Diamond Corp

The final stock on this list is Lucara Diamond. It’s a Canadian company that was founded in 2009. This company focuses mainly on the mining side of the diamond industry, with its primary operations in Botswana.

It has 100% ownership of the Karowe diamond mine which has a throughput of between 2.5 and 2.8 million tons of rough diamonds per year. Lucara Diamond recovered three diamonds over 1,000 carats and 25 diamonds over 300 carats from this mine. It’s one of the world’s largest producers of high-quality diamonds over 10.8 carats.

Lucara Diamond also owns Clara Diamond Solutions, a secure digital sales platform. The platform’s goal is to modernize the existing diamond supply chain. It’s one of the top diamond stocks that gives investors exposure to more than just mining.

Another Diamond Stock to Consider

Although it isn’t a pure diamond play, Signet Jewelers Limited (NYSE: SIG) is another good choice. That’s because Signet Jewelers is the world’s largest retailer of diamond jewelry. So, you would still have exposure to the diamond industry, just not the mining side.

You might not have heard of Signet Jewelers before, but you’ve probably heard of some of its subsidiaries. It owns some of the largest jewelry stores in the U.S., like Zales, Kay Jewelers, Jared and more. It also acquired the online retailed James Allen to capitalize on the push to e-commerce.

The Bottom Line on Diamond Stocks

The diamond industry is one that has stood the test of time and these diamond stocks could do the same. Although it was challenged in the pandemic (like every other industry), it bounced back well in 2021 and is poised to do the same this year.

But as always, do your own research and due diligence before making any investment decisions. Furthermore, you may want to consider signing up for a few of the best investment newsletters. These daily briefings give readers expert stock insights, chart pattern analysis and stock forecasting that may help you enhance your portfolio.

The post Top 5 Diamond Stocks To Buy appeared first on Investment U.

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Economics

Are Retail Investors Done? Biggest Liquidation Since 2020 As Retail Is Now ‘Selling The Rally’

Are Retail Investors Done? Biggest Liquidation Since 2020 As Retail Is Now ‘Selling The Rally’

When it comes to the stock purchasing (and…

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Are Retail Investors Done? Biggest Liquidation Since 2020 As Retail Is Now 'Selling The Rally'

When it comes to the stock purchasing (and selling) habits of institutional and retail investors, even as the former had aggressively unwound their exposure throughout 2022 with both gross and net leverage at multi-year lows, retail investors showed remarkable stoicism, patience and resiliency. But all that changed in recent weeks, and according to JPMorgan's Peng Cheng, retail traders have now capitulated, not only selling stocks for the second week in a row, but in a stark reversal from their momentum-chasing ways, retail investors sold both the Monday and Tuesday rallies.

  • Specifically, in the past week they net sold - $1.1B (1.9-SD  below 12M average), and more notably they sold the rally on both Monday (SPX +2.59%) and Tuesday (+3.06%). Curiously, they remain buyers in ETFs (+$1.4B) and net bought S&P 500 (+0.7z leverage adjusted) but sold Russell 2000 ETFs (- 2.0z).
  • Retail traders net sold -$2.4B of single stocks. Large cap tech names including AAPL (-$470MM), META (-$134MM), and GOOG (-$128MM), in particular, suffered from heavy selling.

As both retail and gross flows and social media posts show, we are well beyond peak retail enthusiasm and we can now conclude that the distribution phase where institutions sell to retail - which defined markets for much of the past two years - is truly over.

Even more notable is that as the chart below shows, the last two weeks represented the worst selling in single stocks since March 2020 (on the other hand, inflows into ETFs, although showing signs of slowdown, remained positive).

Some more details broken down by industry group and thematic:

  • Large-cap: At the industry group level, volumes were slightly higher, driven by Autos and Consumer Services, partially offset by Tech Hardware. Looking at Large-cap single-stock, retail pared down exposure again this past week (-$2.0B) across most industry groups. We again observed some of the strongest retail selling across Technology, especially Tech Hardware (e.g. AAPL, CSCO). This was partially offset by buying within Autos (e.g. TSLA, RIVN, QS).
  • Thematic: Retail investors again shed exposure this past week across themes, though Green / EV Infrastructure (JPAMIGRN) and Long Rising Oil Beneficiaries (JPAMNRGY) were marginal bright spots. We observed heavier selling across Domestic (JPAMDOME) and Covid-19 Domestic Recovery (JPAMCRDB). On the wage side, we also saw Retail cut exposure to US Wage Growth Sensitive Basket (JPAMWAGG)

Bearish sentiment was also evident in the options market. According to JPM, retail traders sold -$1.0B of delta and bought $520MM of gamma this past week. They supplied -$1.3B of delta on SPX/SPY, QQQ, and IWM, mostly via put option buying.

Finally, just to make things "interesting", here is the latest confirmation that anyone trying to make even a little sense of the market is destined for catastrophic failure: as noted above, JPM said that "retail investors sold the rally on both Monday and Tuesday."

Well, one look at VandaTrack's latest weekly research shows that "retail investors have been chasing the last two days rebound by buying US$ 860 mn worth of US securities on Monday and US$ 960 mn on Tuesday. A considerable amount given that they are usually contrarian and reduce their purchases during rallies. We expect this trend to continue and foresee a slowdown in inflows if the rebound will fade; however, we could see a ramp up in purchases if the rally gains traction."

And while retail investors may have bought... or sold... stock in during the latest meltup, depending on whose "research" one reads, one thing is clear: the recent sell-off in retail favorites such as AAPL and TSLA has had a large impact on retail portfolios’ performance and as of yesterday, the average retail portfolio’s relative drawdown is again close to -32% and has started to underperform the S&P 500 again.

As Vanda notes, "additional losses will be both financially and psychologically hard to handle for the average retail trader", and the greater the eventual drawdown, the less likely retail will be to rush into the next dip and buy it.

Tyler Durden Thu, 10/06/2022 - 15:39

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What Is the New York Stock Exchange and What Does It Do?

What Is the New York Stock Exchange in Simple Terms?With more than 2 billion shares trading hands each day, the New York Stock Exchange (NYSE) is the world’s…

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The New York Stock Exchange is located on Wall Street in New York City.

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What Is the New York Stock Exchange in Simple Terms?

With more than 2 billion shares trading hands each day, the New York Stock Exchange (NYSE) is the world’s largest exchange for securities trading, which is the buying and selling of debt or equity, such as stocks and bonds. The NYSE is located in a historic building in the heart of New York City’s financial district at 11 Wall Street.

The NYSE was known for centuries as the "Big Board" because brokers would use an auction-based system to buy or sell shares of stock from its trading floor, and share prices were updated throughout the day on a large board that traders could see from the trading pit. 

A ringing bell signaled the beginning and the end of the trading day. The opening bell signaled the start of the trading day at 9:30 AM, and the closing bell happened at 4:00 PM, marking the end of the trading day. Trades at the NYSE took place on an actual trading floor up until the onset of the COVID-19 pandemic, when everything moved online; floor trading resumed for vaccinated brokers in May 2021.

Is the NYSE a Stock Exchange or a Stock Index?

The NYSE was a privately-owned exchange, or a place for trading, from its inception in the late 1700s until 2006, when it was bought by Intercontinental Exchange, which took shares public. Its ticker symbol is ICE.

However, since the New York Stock Exchange is the world’s largest trading exchange, with over 80% of the S&P 500 companies trading on it, the NYSE Composite, made up of 2,000 stocks listed on the NYSE, has come to be known as a benchmark stock market index. Glancing at how it’s doing gives investors a sense of the overall health of the financial markets. An exchange-traded fund (ETF) based on the NYSE Composite was introduced in 2004; its ticker symbol is NYA.

In addition, the New York Stock Exchange owns a smaller stock exchange, the American Stock Exchange, which it acquired in 2008. Now known as the NYSE American, it is where small-cap companies trade on lower volumes.

What Does the New York Stock Exchange Do? Who Works There? How Does It Make Money?

The NYSE has two purposes:

1. It facilitates buy-and-sell trades of securities.

2. It enables companies to raise capital by selling stock.

The NYSE was originally founded as a space exclusively for securities trading under the Buttonwood agreement in 1792. Prior to that, traders had to sell securities alongside commodities like coffee and tobacco and often had to do so outside, in rain and snow, which is how they got the nickname curbstone brokers.

The Buttonwood Agreement also established regulations and set standard commission fees that brokers could charge clients. Now, with a roof above their heads, traders could call out buy and sell orders from the trading floor; those transactions would be recorded, which provided a level of transparency as well as liquidity that before had not been possible. It was the beginning of efficient market operations as we know them.

Today, computers do most of the buying and selling at the NYSE, although there are still several hundred brokers and traders who shout their orders from the trading pit each day. The scene plays host to dozens of media outlets as well as executives and celebrities who ring the opening bell.

The NYSE makes money through revenues from transaction fees it charges to brokerages, asset-management companies, and market makers. In addition, all members of the NYSE are required to pay yearly membership fees as well as an additional fee to apply.

What Are the New York Stock Exchange’s Hours? Can I visit the NYSE?

The NYSE operates Monday–Friday from 9:30 AM–4:00 PM eastern time. It is closed in observance of the following holidays; when the holiday falls on a Saturday, it closes the Friday before.

  • New Year’s Day
  • Martin Luther King, Jr. Day
  • Washington’s Birthday
  • Good Friday
  • Memorial Day
  • Juneteenth
  • Independence Day
  • Labor Day
  • Thanksgiving Day
  • Christmas Day

The NYSE was open for tours up until the September 11, 2001 attacks; it is no longer accessible to the public.

Which Companies Are Listed in the New York Stock Exchange? How Does a Company Get Listed?

The NYSE lists over 2,000 U.S. and international stocks—for the current lineup, check the directory on its website.

What Is the Difference Between the NYSE and the Nasdaq?

The NYSE and the Nasdaq are both stock exchanges, but the NYSE is much larger. It has a market capitalization of $26 trillion as of 2021, compared with the Nasdaq, which has a market cap of $19 trillion.

In addition, there are several other key differences:

Differences between NYSE and Nasdaq Exchanges

The NYSE sets prices through an auction market, which means that shares are bought directly by buyers from sellers, and share prices are set based on the highest price a bidder is willing to pay and the lowest price a seller will accept.

The Nasdaq uses a dealer market, which means that buyers and sellers do not interact directly; rather, the trades are handled by a dealer, often a larger brokerage known as a market maker, which maintains inventories of stocks and facilitates trades from its own accounts.

Where Is the New York Stock Exchange at Right Now?

For a live feed of NYSE prices, check out its website.

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Volatility Snaps Near-Term Conviction

Overview:  The markets seem to lack conviction today. Stocks in the Asian Pacific region advanced. Europe’s Stoxx 600 is giving up its earlier advance,…

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Overview:  The markets seem to lack conviction today. Stocks in the Asian Pacific region advanced. Europe’s Stoxx 600 is giving up its earlier advance, and US futures are heavier. Australian and New Zealand bonds played catch-up after the rise in the US and Europe yesterday. Their benchmark yield rose 14 bp and 10 bp, respectively. The US 10-year Treasury yield is firm near 3.77%, while European bonds are narrowly mixed, though Gilts are under pressure. The 10-year yield is up 10 bp to 4.12%. The dollar is mixed with the dollar-bloc currencies, sterling and the Norwegian krone on the weaker side. Those G10 currencies like the euro, Swedish krona, and Swiss franc are barely holding on to gains. Gold snapped a six-day rally yesterday and is a little lower today. It still looks poised to retest $1700. December WTI is little changed against rallying more than 10% in the first three sessions this week. It is near $86.70 after settling last week slightly below $78.75. US natgas is rising for the third consecutive session. Its 1.4% gain follows a 7% increase in the past two sessions. Europe’s natgas benchmark is off 3.1% to offset a good part of yesterday’s 3.5% gain. Iron ore rose for the third consecutive session, but it is flat on the week. December copper is also rising for a third session, but it is up about 3.5% this week. December wheat is extending its slide into a fourth session. It is off about 3% this week after rising 7% over the past two weeks.  

Asia Pacific

Australia reported a smaller than expected trade surplus for August. Exports rose 3% after a 10% fall in July, while imports rose 4% after a 0.5% increase previously. Economists in Blomberg's survey had expected a small decline in imports. The surplus of A$8.3 bln missed the median forecast for a $10 bln surplus and was smaller than July’s nearly A$9 bln surplus. Still, in the first eight months of the year, the average monthly surplus was A$11.1 bln compared with A$10.2 bln in the same period last year. In Jan-Aug period in 2019, the average monthly trade surplus was A$5.7 bln.

Japan weekly portfolio flow data showed that into the end of the fiscal half year, Japanese investors continued to divest foreign bonds. Japanese investors some JPY886 bln of foreign bonds. This bring brings the four-week total JPY3.3 trillion (~$23 bln). Japanese investors bought foreign equities for the third consecutive week for a cumulative total of JPY876 bln (~$6.1 bln). Meanwhile, foreign investors continued to be significant sellers of Japanese bonds. They sold JPY1.56 trillion in the last week of September to bring the four-week total to a whopping JPY6.4 trillion (~$45 bln). This appears to be a record outflow. Foreign investors were net sellers of Japanese stocks for the sixth consecutive week. Over the past four-weeks, they sold JPY2.6 trillion ($1.8 bln), the most in six months.

The US dollar recovered from yesterday's seven-day low against the yen (~JPY143.55) to JPY144.70. It remains firm, though in a narrow range and has not traded much below JPY144.40. Market participants continue to seem uncomfortable buying dollars above JPY145.00. The Australian dollar tried to extended yesterday's recovery off the $0.6415 area and made it $0.6540 before being turned lower. It traded to around $0.6480 in the European morning and could slip a little more. There are options for almost A$600 mln at $0.6475 that expire today. We assume they have been neutralized. The intraday momentum is oversold, suggesting a better tone is possible in North America. The base around $0.6400 looks firm. China's mainland markets remain closed for the Golden Week holiday. The US dollar fell to almost CNH7.0125 yesterday and has steadied today, remaining within in yesterday's range. Recall that it settled September (the last day mainland markets were open) near CNH7.1420. 

Europe

German factory goods fell 2.4% in August, more than three-times more than expected. On the other hand, the July series was revised sharply higher (+1.9% from -1.1%) on the back of large aerospace orders, according to the government, which looked like foreign orders. Domestic orders fell 3.4% in August after dropping 3.7% in July. Foreign orders fell 1.7% in August but rose 6.0% in July. Orders from the eurozone rose 4.5% in July and fell 3.8% in August. Separately, the construction PMI fell to 41.8 from 42.6. It has not been above the 50 boom/bust level since March. Tomorrow, Germany reports August retail sales (median in the Bloomberg survey calls for a 1.2% decline) and industrial output (expected to fall by 0.5% after a 0.3% drop in July. Note that the eurozone's aggregate retail sales were reported today. While the 0.3% decline was expected July's 0.3% gain was revised to a 0.4% decline.

A week ago, S&P lowered the outlook of its AA UK rating. However, this seemed to be catch-up as both Fitch and Moody's had the credit as the equivalent of AA-. Today, Fitch puts cut its outlook to negative, reflected the unfunded tax cuts. We await today's report, but on Tuesday and Wednesday the. BOE did not buy any bonds. This emergency program to address what had appeared as a threat to financial stability is to conclude at the end of next week. The concern is what is going to happen afterwards. The BOE's program aimed at the long-end of the curve. The UK's 30-year bond yield was around 3.5% in the middle of September. The yield jumped to almost 5.0% on September 27 as the market reeled from the mini-budget and the forced liquidation. The BOE stepped in and at the end of last week, the 30-year Gilt yield was about 3.82%. However, it has risen each session this week and now stands a little above 4.25%. Many expect the BOE to address this may either a new permanent facility and/or some other measures, including, perhaps, delaying further when it intends to sell bonds that it bought during the pandemic.

Parity capped the euro over the past two sessions. The euro was sold to $0.9835 yesterday and has recovered to trade in about a quarter-cent range on both sides of $0.9900. While the range can extend in North America, we suspect that the proximity of tomorrow's US jobs data is conducive to a consolidative tone. The $0.9950 area may offer a nearby cap. Similarly, sterling encountered strong resistance near $1.15 and was sold to almost $1.1225 yesterday. It recovered to a bit more than $1.1350 yesterday in North America and extended it a bit further today (~$1.1385). It retreated a cent by early European trading and found support near $1.1280. The intrasession momentum indicator is turning ahead of the North American open.

America

Yesterday's data prompted the Atlanta Fed's GDPNow to lift its Q3 estimate to 2.7%, the highest so far in the quarterly cycle. The strong dollar is expected to hurt US exports, but real (adjusted for inflation) have been strong. In August, real exports rose by about $2.8 bln while real imports fell by $1.4 bln. Net exports could contribute 2-3 percentage points to Q3 GDP. A combination of factors drove this, and it probably will not be repeated in Q4.

It seems rich for many observers to say that OPEC+ decision to cut output is a snub against the US. The Federal Reserve's monetary policy is making it more difficult for many countries but few of the OPEC+ critics want the Federal Reserve to sacrifice its domestic mandate,  The OPEC+ decision may be short-sighted, as the White House claims,  these countries pursuing what they think is their national interest. A few years ago, many of these critics thought OPEC was dead. Moreover, actions by the US and Europe, such as the embargo on Russian oil and cap on prices, impacts the oil market. The US official comment that the yesterday's decision shows OPEC is aligning with Russia shows a masterful grasp of the obvious. OPEC+ is set to continue through 2024. OPEC was struggling to be the swing producer, partly because of the rise of US production. The answer for the cartel to the competitive challenge was to increase its market share by forming the alliance. Some pundits suggest the US should stop selling weapons to Saudi Arabia and others in OPEC. Yet, what is missing is the understanding that the US does not assist in the defense of the Saudi Arabia or oil pipelines out of a sense of altruism, but because it is understood to be in the US national interest. Should the US really take on the position of Gandhi's mother who would fast (punish herself) when her prodigious son disappointed?  Implicit in Biden's threat yesterday will be to reanimate the NOPEC bill that has been in Congress for some time that would allow lawsuits against OPEC members for manipulated the energy market.

The US reports weekly jobless claims and the Challenger jobs cuts. In the last week in September, weekly jobless claims fell to five-month lows. The JOLTS data, earlier this week (August) disappointed, and tomorrow the national September figures will be reported. The median forecast in Bloomberg's survey calls for an increase of 260k after a 315k increase in August. Today, five Fed officials speak (Kashkari and Mester twice). These Fed officials' views are well known, and indeed, everyone seems to be singing from the same hymn sheet. The market recognizes this, and the implied yield of the December Fed funds futures contract is rising today for the sixth consecutive session.

The US dollar found a bottom against the Canadian dollar in the past two sessions near CAD1.3500. It recovered yesterday and closed above CAD1.3600. It initially pulled back in Asia, as US stocks were bid. It found support near CAD1.3565. The greenback has recovered in the European morning to reach the session high around CAD1.3665. Yesterday's high was just shy of CAD1.37. While taking cues from US equities, note that intraday momentum for the greenback overextended against the Canadian dollar. After a push to almost MXN20.60 in late September, the US dollar has returned to the MXN19.80-MXN20.20 range that has dominated since mid-August. It is in a narrow range (~MXN20.0175-MXN20.1050) today. It appears to have scope to test yesterday's high near MXN20.15. 


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