Naturally Colored Diamond Blog

Need To Know: How To Invest In Colored Diamonds

Posted by Tony Cathaway on 3/9/17 9:17 AM

Investments come in all types of forms. From real estate and stocks, to crude oil and gold. Another fast growing form of investment is within the world of naturally colored diamonds.

colored diamonds

In this post, Arpège Diamonds discusses some of the elements you may want to know before you invest in your first colored diamond.

Reasons to Invest In Colored Diamonds

Are you unsure if colored diamonds are right for you? Let’s take a look at 4 reasons why you should invest.

  1. Naturally colored diamonds are in high demand.

The Argyle mine, which produces 90% of the pink diamonds across the world, is slated to close in the year 2020. What does this mean for value of colored diamonds? An investor should consider the impact of future supply and demand and act accordingly today.

  1. Value of a colored diamonds increasing rapidly

Colored diamonds have grown by an average of 167% since 2005, according to a report by the Israeli Diamond Company. More specifically, pink diamonds have soared up 315%! As mentioned previously, with the Argyle mine closing, supply is not infinite and could dry up very quickly.

  1. Diamonds are an asset that won’t diminish over time

Imagine this hypothetical scenario: in one hand you buy a $20,000 pink diamond; on the other you buy a $20,000 brand new car. What do you think is going to happen in terms of value in 5 years? What about in 10 years? The car loses value the moment it steps out of the dealership, whereas the pink diamond will have retained its value.

  1. You can wear it

Although this seems obvious, colored diamonds are an investment you can enjoy. In a molecular level, diamonds are extremely durable. With a polish once in a while, you can wear your investment to any event. Don’t feel comfortable wearing an expensive investment? Colored diamonds hardly take any space! They're an investment you can safely secure in any location.

 

Need To Know: How To Invest In Colored Diamonds

Colored diamonds fall under the category of treasure assets. (Treasure assets are tangible items such as fine art and jewelry that are collected for both their beauty and worth.) Let’s explore the basic guidelines you should follow when investing in colored diamonds

  1. Set a budget

Although this seems obvious, setting a budget will help determine the type and quality of diamond you might want to go after. 

  1. Learn about colored diamonds

It’s a smart idea to take some time out and learn about colored diamonds. Learn about the different styles, colors, diamond language, etc. As they say, the more you know, the better.

  1. Diversify your investment

When it comes to investing, especially colored diamonds, the smartest move is not to put all your eggs in one basket. If you set yourself up with a budget of $25,000, then consider investing in two diamonds that equal your budget. (For an example, buy two different diamonds that cost $10,000 and $15,000 respectively.) Additionally, don’t invest in the same diamond twice. Each individual color diamond has seen different growth rates. With fluctuating growth rates, selling two different colored diamonds will be easier than selling just one. 

  1. Do your homework

Diamond prices are not set by hundreds of thousands of investors like a stock. Prices will vary by online retailers and you can easily compare the different costs. Make sure you do your homework and find the best deal depending on size, color, and clarity. 

  1. Be smart

This seems like an obvious one, but be smart with your investment. Make sure you buy a diamond that is certified. The smartest investment is buying a diamond that is specifically certified by the GIA (Gemological Institute Of America). The GIA also offers a grading report. This will be useful when selling your stone in the future.

  1. Ask questions

There’s no such thing as a dumb question. If you haven’t invested in colored diamonds before, the more questions you ask, the better. Don’t be shy. Reach out to as many diamond consultants and experts as you can, they’re there to help. Check out forums, blogs, news articles, etc. We live in a digital age where information is at our fingertips.


If you are unsure about how to position your investments in fancy colored diamonds, Arpège Diamonds stands ready to help.  With over 50 years of combined industry experience, we'll help you gather the most effective information and insights so that you can make educated decisions on your fancy colored diamond investing.  You can contact us at 866-821-5508 for a personalized review.

For more reading on colored diamonds, check out the link below. 

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