Diamonds: The Ultimate Investment


By Susan DeBakey –

Susan DeBakey
Loggins Jewelers

For millennia, the wealthy and powerful have paid any price to possess the rare and the beautiful. Among gemstones, the most highly prized continues to be the Fancy Colored Diamond. As Confucius said, “Better a diamond with a flaw, than a pebble without.”

Investors today of rare gemstones agree, except of course, for the part about the flaw!  Indeed, all diamonds are not created equal.  Investment grade diamonds, only .1% of mined diamonds, are usually 10 carats or larger, naturally mined and untreated, internally flawless or nearly so, of exceptional cut, symmetry and polish, and either:

COLORLESS or nearly so, graded no worse than F.  Given by Richard Burton to Liz Taylor, the famous 33.19-carat asscher cut diamond is colorless and flawless.  Known as a IIa diamond because it contains no nitrogen, this chemically-pure diamond is from India’s ancient lost Golconda mine. Only 2% of all diamonds are classified as IIa.

FANCY COLORED or exhibiting strong, consistent color.  The 45.52-carat Hope Diamond is the world’s most famous blue diamond.  Also from Golconda, it is a type IIb diamond, meaning it also lacks nitrogen, but contains traces of boron that give dramatic, deep blue color.

RARITY AND AVAILABILITY.  “Every year 12 to 14 million carats of diamonds, roughly one-tenth of world production, are mined from Australia’s Argyle mine to be polished and sold,” according to color diamond experts at Asteria London.  While 90% of all-natural pink diamonds found today are sourced from Argyle, “It is estimated a mere 0.0001 of Argyle’s marketed diamonds are pink.” Averaging only 40 to 50 carats of pink diamonds each year, the mine is slated to close by 2020, and prices are projected to soar. Currently, “Pink diamonds are selling at 22 times 1979 market values.” In the future, Argyle pink diamonds could become as coveted to gem collectors as Burmese rubies and Kashmir sapphires. Such rarity adds to investor demand.

Additional selling points to investing in diamonds are portability and low maintenance, compared to collectible art or wine, and the ability to enjoy wearing one’s investment.  Thus, investment quality diamonds are increasingly sought by investors as a way to protect wealth by diversifying and hedging portfolios.

Arnoud Bastien, President and CEO of Graff Diamonds Asia, agrees. “Diamonds are no more speculative than most stocks or shares. Investing is always a gamble, and the old rule holds: don’t gamble with what you can’t afford to lose.”

According to Arpege Diamonds, experts in colored stones, “Over the past decade, naturally colored diamonds have seen an exponential increase in value, steadily surpassing other forms of popular investment assets such as gold, stocks, oil and classic cars. Since 2005, pink diamonds have increased in value 600%.”

Auction houses such as Sotheby’s and Christie’s reflect growing investor demand. The Graff Diamond Company’s 59.60-carat “Pink Star” sold for a record $71.2 million dollars at Sotheby’s Hong Kong in 2017.  Previously, the world record for the most expensive diamond sold at auction was held by the 14.62-carat Oppenheimer Blue Diamond sold at Christie’s Geneva in 2016 for $57.50 million.

And if you’re not a multi-millionaire but would like to buy a diamond that can be enjoyed while financially appreciating over the long term, what to do?  A good bet is a certified natural Fancy Colored 2-carat or larger radiant-cut diamond.  Prices vary with rarity and the four C’s: Cut, Color, Clarity and Carat weight.  Most rare, thus highest priced, are blue diamonds, followed by red and pink. Slightly more available and affordable are canary diamonds.  The least expensive and rare are shades of brown often marketed as champagne and chocolate diamonds. For those not into color, consider a round radiant cut white diamond that is at least F in color.

All diamonds are bought with the hope of future appreciation and should be professionally certified by either GIA or AGL.  The diamond should rate IF (internally flawless) to VVS (very, very slightly included) and be designated of exceptional color, cut, polish and symmetry.

Of course, verify before you buy!  There are many fake certifications out there.  Certifying agencies have websites where buyers can enter the certificate number to verify authenticity of the certificate and see a picture of the stone in question. No reputable seller will refuse to give the certificate number to a buyer who wishes to verify before buying.

Never buy online. Buyers should examine the stone in person with an educated gem expert having a long corporate history. Loggins Jewelers has been Fort Bend’s most trusted jeweler for over thirty years.  Our knowledgeable team is proud and grateful to once again be voted Best Jeweler by Fort Bend Focus readers!  Visit logginsjewelers.com or call 281.242.2900.