Investment Grade Diamonds
Not all diamonds make the grade
Like all things in life, the rarer the item, the more precious and valuable it becomes; this reins especially true for diamonds.
Not all diamonds can be considered investment diamonds, meaning those that will maintain and grow in value over time; the majority of diamonds on the market, particularly the familiar colourless diamonds seen in jewellery stores, are actually quite common. This holds true even in the case of very large, top quality and top price colourless diamonds – the reality is, there are many such stones on the market, making it difficult to realize full market value when re-selling.
Investment-grade diamonds must be of a degree of rarity that holds an intrinsic value, and of a category with robust demand to ensure an equally robust resale market when it comes to selling down the road.
In other words, there must be a balance between rarity and liquidity – diamonds that benefit from their degree of rarity while still offering relative ease of purchase and sale.
Quality pink, blue, and red diamonds meet this criteria by their very nature – they constitute less than 1% of all coloured diamonds available, and represent a minute fraction of all diamonds in the world. Demand for these precious gems continues to grow as supply dwindles, pushing prices higher. In terms of investment potential, Australian Diamond Portfolio recommends these colour categories as those with the greatest potential.