It’s hard to believe, but 2023 is almost three quarters over, with the calendar fast approaching the end of September.
The year has been characterised by several trends that have impacted Australian investors, including persistently high inflation, a falling Australian dollar, higher interest rates and low consumer confidence.
Despite these challenges, property markets, and the ASX 200 have held up relatively well, leading some investors to become far too complacent. There are signs now that weakness is beginning to return to these markets, with property listings surging due to mortgage stress, while the share market looks like it has peaked.
These factors have led to what is effectively a two-tiered outlook for pink diamonds. In the short-term, greater uncertainty, combined with reduced liquidity and reduced free cash flow amongst households means that there has been significantly less turnover in the pink diamond market.
Over the long-term, these factors support a continued bullish long-term outlook for alternative hard assets like pink diamonds, which should eventually benefit from demand as investors seek diversification, risk-protection, inflation hedging and outright sources of profit in their portfolios.
In this week’s article though, we focus on the primary source of pink diamonds over the past few decades, the now shuttered Argyle Diamond Mine.
Specifically, we look at a newly released study on the formation of this world famous diamond deposit that not only highlights how unique it truly was, but even more importantly, why the supply of these unique assets is set to remain so scarce going forward.