Adding pink diamonds to your luxury investment portfolio
The rarest of their kind in the world, pink diamonds are a dazzling addition to any luxury investment portfolio – especially now, during times of economic uncertainty and with their main source about to dry up.
Fine jewellery and gemstones seem to be coming out on top of the coronavirus lockdown, with many investors seeing precious, “tangible” assets as a safer store for their money than the currently volatile stock market or property. The brightest jewel in the investment crown is undoubtedly the pink diamond, which is not only one of the most dazzling precious stones in the world, but is also incredibly rare – and about to become even more in-demand.
Around 90% of pink diamonds are currently sourced from Rio Tinto’s Argyle Diamond Mine in the Kimberley region of Western Australia, a place of such unique geology that it causes this “fluke of nature”, according to Anna Cisecki, executive director of the Australian Diamond Portfolio. The conditions here unite to somehow create these blushing jewels – “somehow”, because no one really knows what gives them their colour, unlike other diamonds where trace minerals are responsible for hue.
Since it opened in 1983, the Argyle mine has produced more than 865 million carats of rough diamonds. Only one-tenth of 1% of gems mined are pink, however. They’re already one in a million – quite literally – and with the mine closing at the end of 2020, their scarcity is set to see values skyrocket.
“Over the last 15 years, the value of pink diamonds [up to 50 times the price of their white equivalent] has increased more than 400%, steady at 11% per annum,” says Cisecki. “The next 10 to 15 years could be even more rewarding.”
Cisecki’s company offers end-to-end solutions for pink diamond investors, from education to sourcing to sale. She says that above and beyond the beauty and rarity of these gems, they’re particularly popular during times of economic uncertainty as they offer a “quality hard investment”.
“Not all diamonds are a good investment,” Cisecki says, pointing out that many white diamonds are just not that rare. “For an investment, diamonds need to have an intrinsic rarity, as pink diamonds do. As a result, the value of pink diamonds may plateau, but it never falls,” she says. “They don’t experience the price volatility of equities or even gold. Their value has show consistent stability in growth.”
It’s important to note that not all pink diamonds are created equal – like other gemstones, there are variations in the richness, brightness and vibrancy of colour, with the stones graded along a spectrum of shades that ranges from Faint to Light to Fancy Intense and Fancy Deep. While you can expect to pay millions for top-quality stones – the most expensive pink diamond ever sold was a US$50.4 million Fancy Vivid pink diamond, just shy of 19 carats – you can also enter the market for as little as $20,000, says Cisecki. A sparkling investment indeed.
If you’re dazzled by pink diamonds, the Australian Diamond Portfolio offers end-to-end solutions to potential investors, from education to sourcing, storage, insurance and sale, if that’s the end goal.