Naturally Colored Diamond Blog

The Pink Diamond Investment. Is It In Your Portfolio?

Posted by Tony Cathaway on 12/15/15 9:00 AM

In November of 2010, a diamond sold at Sotheby's 47 million dollars. At 24.7 carats, it was certainly a large stone, but not nearly large enough to justify its record-smashing winning bid. What made this particular diamond so unique? It was pink. pink_diamond

With the global stock market in a constant state of flux, more and more people are turning to tangible investments like real estate and treasure assets to protect their wealth. Among treasure assets, loose stones are seeing a big spike in popularity, and colored diamonds have risen to the forefront as one of the most stable and lucrative investments you can make. Why should you consider jumping on the trend of colored stones, especially pink diamonds? There are a number of reasons.

 

A Stable and Growing Treasure Asset

Colored diamonds are gaining traction as an investment asset all over the world. Their rarity makes them a very stable buy.  Only one diamond in every ten thousand is naturally colored, making it essentially impossible for the market to become flooded or the prices to crash by other means. In Barclay’s Wealth’s report on 2014 investment trends, 70 percent of their respondents to a world-wide survey now invest in precious jewelry, making it the most popular treasure asset in the world. That number is growing, too,  Twenty six percent of Barclay’s investors possess more treasure assets than they did five years ago. Such a stable, long-term trend is always a good indicator of a solid investment opportunity with real potential to pay off.

What sets pink diamonds apart as an investment opportunity? In addition to the stability of loose stones, pink diamonds are seeing a huge surge in interest, as well as price. The Argyle mine in West Australia was temporarily closed in 2013, shutting down the world’s premier supplier of naturally colored diamonds. The mine was recently converted from an open pit mine to a completely underground operation. The conversion is anticipated to extend the life of the mine until approximately 2020.

Given the impending closure of the Argyle mine, many investors see pink diamonds as a resource that will be finite relatively soon. Consider that as recently as a few years ago, pink diamonds were valued at $13,000 per carat. By 2014, that price per carat was an incredible $78,000. Pink diamonds have been seeing a reliable 20 percent annual increase in value, year after year and it’s clear to see why they are rapidly becoming such a popular investment option.

 

A Wearable Investment

In addition to their stability in price, stones have been popular as a tangible investment, one that is easily stored and moved. Stones can be purchased and stored, or they can be set in jewelry, allowing you to wear and enjoy your investment.

The current trend in the popularity of colored engagement rings kicked off, like so many trends do, in Hollywood. Jennifer Lopez’s six-carat pink engagement rings may be one of the most famous stones in recent history. The trend of colored stones has resurfaced again in recent years thanks to Duchess Kate Middleton’s 18 carat sapphire ring, (originally Princess Diana’s). More and more ladies find themselves presented with pink, yellow, and chocolate diamonds in their engagement rings…and that trend is helping to keep interest up, and the prices high and stable.

 

Loose Stones or Jewelry?

Investing in jewelry may be tempting, but for the best prices, the experts recommend purchasing loose diamonds wholesale. Loose stones may be stored, or they may be set as wearable pieces. Companies focusing on investment grade stones offer the most competitive prices, as well as the best quality.  Stones already set in jewelry may be selected to suit the setting, not for the best cut or shine.

Purchasing loose stones is also the best way to source specific cuts or fancy-colored diamonds. Rising interest in diamonds as an investment and the growth of the online diamond trade has made finding wholesale stones easier than ever. There are a number of online markets that are easy to search through, to select exactly the stones that fit your needs as an investment or as a jewelry piece.

 

A Few Final Words

Pink diamonds are a unique investment opportunity. Their rarity makes them a stable selection, and the closure of the Argyle mine is driving their price higher and higher. They’re an option worth considering for qualified investors looking for a stable treasure investment with a great chance of paying off high dividends in the future.

For more reading on alternative investments, click the links below: 

 

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Topics: Alternative Investments

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