When you’re disappointed in one thing, try out another, right?
That’s exactly what investors who have been disappointed by returns from other assets are doing, investing their money in coloured diamonds instead.
Just last spring, a Geneva-based fund manager invested more than $1 million per carat in a vivid orange, 4.08 pear-shaped diamond.
And, according to the Wall Street Journal, more and more of these types of transactions are taking place:
Over almost eight years, from the start of 2009 to Sept. 30, 2016, the latest recorded data, the price of pink diamonds has increased nearly 180% and sits at a record high.
Blue and yellow diamonds are up by around 70% and 90%, respectively, over the same period, according to the Fancy Colour Research Foundation, based in Tel Aviv.
Coloured diamonds are created through various processes: when a chemical element such as boron (blue) or nitrogen (yellow) is trapped during the diamond’s formation over millions of years, when natural radiation form nearby rocks trap electrons to create a green surface colour, or when changes to the electron structure during the voyage to the surface create pink or red shades.
They are part of a boom of an over-the-counter luxury market, like that provided by local retailers Diamond Jewellery International (DJI).
Who are these people getting in on colour diamonds? Financial investors, transforming the market place by investing clients’ money in rare gems:
Record auction prices highlight the soaring demand over the past year. Last May, a 14.62-carat blue diamond sold for $57.5 million at auction in Geneva, making the gem the most expensive jewel ever sold at auction.
In November 2015, also at a Geneva auction, the 12.03-carat Blue Moon sold for nearly $50 million, becoming the only diamond to sell for more than $4 million per carat.
It’s not just the fact that these diamonds have a hint of colour in them that is making them so expensive – it’s their rarity.
Just one in every 10 000 diamonds has a hint of colour and some, such as as red diamonds, are so rare that only a handful are known to exist.
In fact, the Gemological Institute says its laboratory didn’t see a single red diamond from 1957 to 1987.
In bad times, it’s a very good place to keep your money, and in good times, it’s a something to enjoy – so how much are you willing to invest in some coloured diamonds?
Give DJI a call and they will definitely sort you out, as they offer an unsurpassed diamond-buying experience.
Their specialities include:
The best part? They work within your own budget to make sure you get the most bang for your buck, whether it’s now or later in life.
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