What is so special about diamonds?
After a period of weak demand for diamonds throughout the late 1800s and early 19th century, the De Beers mining company sparked a resurgence in the precious stone’s popularity with their wildly successful “A diamond is forever” advertising campaign of 1947. With De Beers effectively controlling the world’s diamond supply, while simultaneously convincing the public that diamond was the stone du jour for an engagement ring, demand rose once again, and its popularity has endured.
In the immortal words of the iconic Marilyn Monroe, “Diamonds are a girl’s best friend.” The endorsement of one of the 1950s most popular sex symbols, along with the De Beers campaign, definitely helped to increase the desirability of these particular gemstones. These days, more than three quarters of all engagement rings sold contain diamonds, and the trend shows little sign of stopping any time soon.
However, like many of our natural resources, diamonds are not a finite resource and diamond deposits are slowly being depleted and gem-quality stones are increasingly rare and, the rarer they are, the greater their value. Diamonds are now far more than just sparkly, pretty adornments – with less than 20% of all diamonds mined being gemstone (or jewellery) quality, and fewer than 2% being considered ‘investment diamond’ quality, the diamond you purchase has the potential to significantly increase in value over time.
What is an investment grade diamond?
Rarity + demand = investment diamond
As mentioned earlier, the rarer the diamond, the greater the value attached to it. However, for a diamond to be considered an ‘investment diamond’ it must fulfil two criteria:
- The stone must have a degree of rarity that gives it an intrinsic value, and
- The stone must belong to a category of diamond for which there is strong ongoing demand.
Colourless investment diamonds
When selecting a white (or colourless) diamond, a higher grade of colour and clarity does not necessarily make for a better investment. Liquidity is also an important factor in determining whether a particular stone is a good investment – that is, if there is only a small market for your diamond when you choose to liquidate your investment, actually being able to find a buyer may limit your potential to fetch the full market value of your stone.
For example, your diamond may be the highest colour grade – D, or have a high grade of clarity, but because colourless diamonds are hardly scarce, and most are used for engagement rings, the market demand for the highest grades of colour and clarity is reduced. This lack of demand may compromise the stone’s capacity for appreciation and make a profitable re-sale more difficult.
So, when it comes to colourless investment diamonds, the best bets are those that have an excellent polish, a GIA Triple Excellent cut and are of a colour, clarity and size that show the greatest demand for engagement rings.
Fancy coloured investment diamonds
It is much easier for high-quality fancy coloured diamonds to meet the criteria for consideration as investment diamonds, based predominantly on their inherent rarity.
Rather than a fancy coloured diamond’s value being based on the standard 4C’s applicable to common colourless diamonds, the value of a fancy coloured diamond is attributable to the stone’s cut and colour – particularly, its hue, saturation, and tone. Essentially, the stronger, brighter and more intense the colour, the rarer and, therefore, the more valuable the stone.
Why are Argyle diamonds special?
The hues, tones and saturation of colour found in Argyle coloured diamonds is what distinguishes them from coloured diamonds found elsewhere in the world. Argyle pink diamonds display distinctly richer red-, purple- and blue-based tones, and these marked colour differences, coupled with a much higher quality of stone, set Argyle pink diamonds apart from the equivalent high quality stones found in other locations, such as Russia, Africa, Brazil, and India.
Claiming fame as the largest and most significant source of rare pink and red diamonds, the Argyle mine in the Kimberley region of Western Australia has been the only reliable supplier of pink diamonds, operating for almost four decades. Although the mine has not been the only source of pink diamonds, the Argyle mine has produced over 90% of the world’s supply of pink and red diamonds as well as a significant proportion of the world’s supply of champagne, cognac and blue diamonds.
However, despite being the leading supplier, the rare pink and red diamonds produced by the Argyle mine represent the most minute portion of the world’s diamond supply, at less than 1% of all coloured diamonds available. The incredibly rare blue, grey blue and violet diamonds unearthed at the Argyle mine are considered the rarest diamonds in the world. Of the comparatively small proportion of rare coloured diamonds mined from the Argyle pink diamond mine, the quantity of violet-blue diamonds certified constitutes only 1% of the certified and individually laser inscribed diamonds branded by the Argyle mine.
Why are Argyle pink diamonds a good investment?
The quantity and quality of Argyle diamond tenders has steadily diminished over the preceding decade, with annual tenders progressively yielding much smaller diamonds with lower quality gradings. Having exhausted the supply of gem-quality diamonds that had previously made the Argyle mine an economically viable venture, Rio Tinto ceased all mining operations in November 2020.
The increasing awareness and popularity of Argyle pink diamonds has resulted in continual growth in market demand for these rare and beautiful stones. This consistent demand – particularly from collectors and investors – coupled with the closure of the Argyle mine, has resulted in the steady depletion of an already limited supply of Argyle pink diamonds, which has served to increase both their value and their liquidity.
These factors have combined to make certified Argyle diamonds the perfect limited-edition, tangible investment. Savvy investors who have sought to diversify their investment portfolio by purchasing Argyle pink diamonds in the lead up to, and following the mine’s closure, have seen significant growth in their investment over the past five years. Current market data indicates that certified Argyle pink diamonds have demonstrated an average increase in value of over 18%, outperforming all other investment asset classes.
Argyle Diamond Investments – the high return pink diamond specialists
Argyle Diamond Investments are Australia’s largest supplier of certified Argyle pink diamonds, providing investment diamonds to suit a range of budgets. Our diamond investment specialists are experts in investment diamond acquisition, and are ready to guide you through every step of the diamond investment process, providing professional and reliable diamond investment advice tailored to your individual needs – from choosing the right stone to certification, insurance and storage.
To speak to an Argyle Diamond Investments diamond investment specialist call us on 02 4927 0000. Alternatively, fill out our contact form to book a VIP viewing of our in-store collection, or to have an Argyle Diamond Investments Pty Ltd representative contact you.