We have an action-packed market update this week, with recent news articles helping to clarify a key message about the different segments of the diamond market that has been at the heart of Australian Diamond Portfolio’s engagement with clients over the years.
We also celebrate an important milestone and anniversary for Australian Diamond Portfolio, which would not have been possible without our wonderful client base.
We explore all this in detail below.
Not all diamonds are created equal
Over the many years that we’ve been writing these ‘In the Loupe’ market updates, there have been a handful of recurring themes that we’ve communicated to clients, which collectively help illustrate the unique and valuable role that pink diamonds can play in a portfolio of assets.
On top of that, another item that has always been top of mind is explaining just how important it is to ‘buy smart’ when investing in this sector, and why you can’t simply think of diamonds as one homogenous asset class.
This week we saw two great articles that, collectively, really help illustrate this point.
The first one we saw was published in Bloomberg. Fortune also carried the article. Titled “Diamond Prices are in free fall in one key corner of the market”, the article went on to note that famous diamond house De Beers has recently been forced to slash prices for one of its benchmark diamond products.
This is because investors and customers are increasingly looking to lab grown diamonds when buying items like an engagement ring.
In terms of actual price impact, they’ve fallen by some 40%, with the article noting that “In June 2022, De Beers was charging about $1,400 a carat for the select makeable diamonds. By July this year, that had dropped to about $850 a carat. And there may be more room to fall: the diamonds are still 10% more expensive than in the “secondary” market, where traders and manufacturers sell among themselves.”
This story, and the data behind it make it clear – there is no reason to invest in run of the mill white diamonds. They are almost guaranteed to be an investment loser over the medium to long-term (which is not to say they can’t look fabulous in a jewellery piece!).
By contrast, coloured diamonds are the shining light of the diamond world from an investment perspective, with pink diamonds leading the way in terms of performance since the start of the 2000s.
This has been made clear on countless occasions in the past few years, including most recently in an article in The Times. Titled, “Why rare coloured diamonds are a hot investment,” the article looked at some very high-end jewellery items (with multimillion-dollar price tags) that recently went on sale in Paris, and noted that ‘every smart investor wants one’.
That’s music to our ears at Australian Diamond Portfolio, as it echoes what we’ve been communicating since we opened for business.
Australian Diamond Portfolio turns 10
Speaking of opening for business, September 2023 marks 10 years to the month since Australian Diamond Portfolio first opened its doors to clients Down Under!
In that time, we’ve been honoured to serve many thousands of clients, all of whom have invested in these truly beautiful and scarce assets. We are glad they’ve been well rewarded too, with pink diamond prices soaring over the past decade, leading most other asset classes in this time period.
Since our foundation, we’ve been fortunate enough to engage in a range of market leading initiatives. This includes launching the Australian Diamond Portfolio Legacy Collection, and the release of the Australian Diamond Portfolio Pink Diamond Index.
These initiatives, alongside our commitment to client education through these updates and diamond master classes have helped establish Australian Diamond Portfolio as the leading diamond brokerage in Australia, and the only one offering a comprehensive end to end investment solution.
None of this of course would have been possible without the incredible support of our loyal clientele, who make working in this industry, for this company, a genuine honour every day.
Looking forward, we couldn’t be more excited for the long-term future of pink diamonds!
On top of their undeniable ‘wow’ factor, pink diamonds as an asset class have also offered our clients, and will likely continue to offer, long-term returns, as well as capital stability, inflation protection, and portfolio differentiation.
Indeed, over the years, many clients of Australian Diamond Portfolio have told us that their pink diamond holdings are the investment they are most proud of, and one they’d love to leave to the next generation.
Long may such sentiment continue, for it’s ultimately why we come to work every day.
On behalf of the entire team at Australian Diamond Portfolio, we thank you for your support over the last ten years.
Here’s to ten more! 🍾 🥂
As always, we hope you’ve enjoyed this week’s edition of “In the Loupe” and we look forward to any questions or comments you may have.