Natural Coloured Diamond Investment Portfolio Tips

You’ve almost certainly heard that about the world naturally tinted diamonds for jewellery and investment. With the auction prices reaching new heights, and entertainers sporting new fancy shaded diamonds, the stories will continue.  

What is a Natural Coloured Diamond?  

A coloured diamond is among the best gifts given to us by Mother Nature. They come in various shades of pink, yellow, brown, and red. These fancy coloured rhombi are, however, found only in very few areas on the planet. They are valued and priced nearly wholly on the distribution and strength of their colour.  

Argyle Diamonds Investment

The more knowledgeable you are in the area of investing, the more equipped you become to making great decisions. Diamonds exist as a significant asset. While colourless diamonds are generally best as gifts, coloured diamonds are considered as assets with extremely attractive investment possibilities.

The advantages of Australian pink diamonds as an investment is their portability, their durability, their resilience to inflation, and potential to surge in demand. To be fair, though, this type of investment has disadvantages and risks, such as time and the lack of transparency in price. You may be wondering why time is among the disadvantage.  

Perhaps you’ve heard the song, Diamonds are Forever.  Sadly, it is just a song because, just like automobiles, most diamonds depreciate with time.  So, when investing in diamonds, it is best to consider them as a medium investment.

The pink Argyle certified rhombi, on the other hand, can be considered as a good long-term investment because they beautiful and rare, as well as have a high appreciation and small production source.  They are an incredibly scarce investment opportunity.  

With time, the pink diamonds of Argyle brand are expected to continue to increase in value as they become more difficult to source. So, there is no better time for you to start investing in these fabulous Australian pink diamonds right after you finish reading this article!    

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Diamonds Investment Grade

The excellence of diamonds can be described by their four C’s: carat, colour, cut, and clarity.  Diamonds rated as investment-grade are those displaying superior ranges of clarity, cut, and colour as compared to common diamonds. Their ease of sale or ‘liquidity’ is also an important feature of investment-grade rhombi.

A brief walk back through history shows that a small alliance of jewellers established the AGS or the American Gem Society in 1934. The main goal of the group remains to protect shoppers from fraud and false advertising in the industry. In the process, they became the first association to issue a cut grading classification for diamonds in 1966.

The AGS created the grading scale, whereby cut is graded first, followed by colour, clarity, and carat weight. If a stone possessing the best cut grade is also colourless, without blemishes and inclusions, and weighs a carat, it is graded as: 0/0/0–1.000 carat.

Going back to natural coloured diamonds, their starting point stands much better compared to the regular colourless stones. This is because natural coloured diamonds are rare with only one found for every 10,000 diamonds mined.  Moreover, celebrities are increasingly using coloured diamonds as engagement rings, which in turn, increases their popularity and demand.

One more great advantage of natural coloured diamonds is that, unlike their colourless counterparts that come in every size, shape, and colour, every coloured diamond is unique. This is likely due to the consideration of the 4C’s that compels extra attention to the aspect of colour during the production process.

For instance, a slight modification in the colour and pavilion angles of the stone will produce something different. So, when the time to sell comes, someone is certain to purchase your gem because it cannot be found elsewhere. If you are considering investing in natural coloured diamonds, it would be best to familiarise yourself with the essentials, as follows:

1. Knowledge

Obviously, it is logical that you first educate yourself before doing anything else, especially if you are targeting long-term, high-value assets like the coloured diamonds.  Familiarise yourself with the terms used by auction houses, vendors, and gemologists.  

Do your best to fully understand the four Cs of a diamond and the way they contribute towards its value. In terms of colour, the cause of the shade of tinted diamonds differs from one colour to another. For instance, nitrogen in a diamond gives off the cheerful hue of yellow.  In contrast, blue gems contain boron that produces a blue tint. The direct cause of the remarkable colour of red and pink diamonds is still unknown, although there is speculation that they are variations resulting from fractures within the crystal frame.

The infrequent and more intense the tint, the greater is the value of the natural coloured diamond.  The most common are brown and yellow diamonds, while pink, green, blue, and red diamonds are uncommon in all-natural colours.  

On the other hand, colour intensity, which refers to the richness or deepness of the shade, is the top parameter when purchasing a natural coloured diamond. This means that the deeper the tint, the rarer, besides more expensive the diamond is.  

Diamonds with softer colour intensities, such as fancy light, very light, faint, light, and fancy are more usual, and thus, have a lower value. This is in comparison with diamonds having richer levels of intensity of fancy deep, fancy vivid, and fancy intense.  Following colour grade, the carat weight holds the most effect on the price of fancy coloured stones.

A carat is 1/5 of a gram. The term ‘carat’ comes from the earliest measurement unit used by diamond traders, which was the carob seed. The higher the carat of the diamond, the higher the price of the diamond.  

Barely one in a million mined unrefined diamonds is big enough to become a polished one carat diamond. The diamond rates for fancy shaded diamonds, too, increase at tremendous amounts in line with their carat weight.  

Meanwhile, as diamond are formed hidden within the planet under extreme pressure and heat, they often have unique birthmarks internally, called inclusions, or externally, called blemishes. This is where clarity grading comes in. Ranging from ‘loupe clean’, or LC, to ‘internally flawless’, or IF, to Included or I3. The higher the classification on the scale for clarity, the more special and precious the diamond is and the greater the price. Owing to the quality of natural shaded diamonds, clarity remains less important as compared to their counterparts without colour. This is a fact because inclusions have the tendency to be concealed by the colour of the diamond.  

Then again, natural colour diamonds are primarily cut to emphasis their hue. This is in contrast with colourless stones that are cut to get the most out of their brilliance or sparkle. While fancy tinted diamonds still display brilliance, colour is the most significant characteristic considered when being cut.  

In diamonds, shape denotes the overall diamond outline when seen from atop, such as cushion, round, or princess. Many fancy shaded diamonds are cut into extraordinary shapes to boost their natural hue. On account of the rarity of fancy tinted diamonds, not every colour is available in all shapes at all times.

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2. Portfolio Variation

In terms of investing, experts stress the prominence of varying your range, which holds true in diamond investing. While it can be enticing to devote your entire budget to a single beautiful diamond, time and again, it is wiser to divide it, buying three or two diamonds. Furthermore, ensure that the stones you are investing in are of different colour groups.

For instance, assuming that your budget is $30,000, in place of purchasing a single $30,000 diamond, invest in a $5,000 yellow diamond, a $10,000 pink diamond, and a $15,000 blue diamond.  Portfolio diversification is a smart action that permits greater flexibility.  

Value and demand for certain shaded diamonds may rise in the coming years, which also will increase your odds of a high return on investment. The perfect example of this is what is currently happening to investments in the Australian pink diamond. Additionally, when you need to assign investment assets, a part of your diamond portfolio can be liquidated, rather than needing to sell off your entire investment.

3. Diamond Rarity and Quality

If you want an asset to have worth, especially if you are thinking of selling shortly, be certain that you are investing in something exceptional with unique features. Go for a diamond that cannot simply be obtained by anyone else.  

For example, a pink stone with generous clarity will get significantly more consideration from buyers compared to a yellow or colourless diamond of a similar calibre. What is more, an internally perfect, fancy, rich yellow stone will undoubtedly warrant a higher price tag and demand compared to a yellow stone with inclusions.

So, focus on the 4C’s when looking for a diamond that will catch the interest of other people.  Always bear in mind that the goal of investors will always be to discover a stone within their budget that remains desired and well-known yet not so rare or special it doesn’t have a market in support of it.

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4. Market Demand for Certain Stones

Avoid buying stones just to have a diamond investment. If you are thinking of selling your assets at some point, you will need to ensure that your stone is wanted by other people. For example, blue diamonds, while rare, might not get much market interest if they have grey hints or adverse cuts.  

Thus, do some research about each type of stone to find out what cuts are highly and widely valued.  Also, do your best to know how traces and modifiers affect the value and desirability of precise stones.    

5. GIA Certification

Often, improper lighting or an untrained eye can lead to fraud. Diamonds are highly valued investments, but many factors can affect their value. So, it is highly recommended to ask for  certification before every purchase.   

Better still, choose stones with Gemological Institute of America or GIA certificates. Aside from looking after the worth of your investment, it also ensures the future purchaser that the stone they are buying is genuine when you do choose to put it up for sale.  

The Impact of Probing

Before going into diamond investing, do some further research, like reading diamond forums towards seeing what stones stand as greatly demanded.  Also, acquaint yourself with the manner the market moves, besides scanning stories of persons who have lately made diamond investments.  Find out what type of stones did they buy and why.  And if likely, try tracking down and getting in touch with diamond mavens and investment experts for further guidance.

Keywords:  Natural coloured diamonds investment, what is a natural coloured diamond, natural coloured diamonds, diamonds as investments, Argyle Diamond Investments, diamond investment grade

Argyle Diamond Investments are Australia’s largest supplier of Argyle certified pink diamonds and have exclusive use of the Argyle Diamond Analytics™ program. This program is a data driven decision maker that tracks and statistically analyses the rarity, financial growth and value of all investment grade pink and blue diamonds. With this valuable information, Argyle Diamond Investments can offer all clients an investment grade pink from $5,000AUD up. But, the highest growth diamonds, are the larger, stronger colour pinks starting from around $20,000AUD plus.

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