Investment diamonds: Worth the risk?

(jewellermagazine.com) - Why buy a diamond? It’s a question most would answer quite simply: as a symbol of love, either to a special person in one’s life or as a beautiful reward to oneself. In the pursuit for a purchase that encapsulates the emotion of love, a diamond is one tangible way to express intangible qualities, such as beauty, rarity and eternity. That’s the way the diamond industry has operated for generations and also why diamonds have captured the imagination of consumers and their chequebooks. Yet increasingly, diamond is being marketed as an ‘investment’, particularly the rarest varieties in terms of size and colour. Diamond’s attractiveness to investors is based on the relative buoyancy and consistency of the diamond market compared to other investment channels such as shares and property. As headlines abound about record-breaking jewellery auctions, breathtakingly large bids at the Argyle Pink Diamond Tender and, more recently, panic about diminishing supply, it can be easy to lose sight of the unique risks of diamond as an investment.