The global market for fancy color diamonds is witnessing significant growth, driven by increasing demand from passionate collectors of high-end jewelry and individual investors.
Coloured diamonds (red, pink blue) are coveted possession as only one out of 10,000 diamonds is naturally colored diamond. Therefore, their prices appreciate more than regular colourless diamonds.
In fact, rare red diamonds are invaluable and diamonds with a pure red hue can sell for over $1 million per carat.
Most of the extremely rare diamonds that sell in auctions by Christie’s and Sotheby’s are mounted wherein the excellent settings emphasise their colour and hide inclusions.
With fewer of these diamonds being unearthed each year, they become increasingly rare and coveted by high net worth individuals and alternative investment funds.
The key trends for diamond jewelry in 2024 are as follows…
Geometric shapes with crystal clear lines symbolise modernity and add stylish accent to the look
Big oversized hoops are a timeless classic but with intricate details
Bold bangles in a variety of colours and materials including precious gemstones
Chunky chain necklaces add touch of versatility and sophistication to make a statement Floral jewellery designs
Post pandemic, consumers seek immortality and prefer jewelry with personalised/customised touches (including engravings) or bespoke pieces that reflects their unique identity which they want to preserve
Tech savvy millennials have started integrating smart tech seamlessly into their jewelry designs (functionality such as fitness, voice activated controls, interactive, etc)
Millennials/ GenZ are eco-conscious and seek to buy sustainable jewelry that minimize environmental impact.
Over the last 60 years or so, the appreciation value of diamonds has remained stable. From 1999 to 2011, three-carat diamonds increased by 145 per cent, while five carat diamonds rose by 171 per cent (Source: Rapaport Diamond Trade Index). Data indicates that diamond prices have risen by approximately 32-33% over the past decade, resulting in an average annual gain of around 4%.
Investments diamonds should possess the following characteristics to be a good long-term investment: 1 carat plus in weight; round brilliant cut; colour from D to F; clarity from IF or LC (Loupe Clean) to VVS2; very good or excellent proportions, symmetry and polishing; none or slight/faint fluorescence and GIA, IGI, HRD certification. For example excellent returns of 125% plus over a decade were from a round, 3-carat diamond with D colour, IF clarity, very well cut and with no fluorescence.
History [(as per The Fancy Color Research Foundation (FCRF)]
Some of the earliest records of these gems date back to the 6th century when diamonds from the Golconda mine in India were highly prized for their colorless clarity and occasional pink, blue, and yellow hues. These diamonds were incorporated into the jewels of royalty and aristocrats, including the famous Hope Diamond and many other important gems.
Throughout the centuries, fancy color diamonds continued to capture the attention of the world’s most wealthy and powerful individuals. In the 18th and 19th centuries, diamonds in shades of pink, blue, and green were highly valued, and many of these gems were set into exquisite pieces of jewelry worn by aristocrats. For example, the Grand Duchess Vladimir Tiara, created in the early 1900s, features numerous pink and white diamonds and was worn by the Romanovs, the ruling family of Russia.
In the mid-20th century, fancy color diamonds became increasingly popular, with yellow diamonds in particular gaining attention. In 1961, the largest known yellow diamond at the time, the Tiffany Yellow Diamond, appeared in the iconic movie Breakfast At Tiffany’s and was the first ever fancy color diamond on the silver screen.
Privately owned jewelers played a crucial role in facilitating these sales, with many emerging from wholesale backgrounds and gaining a competitive advantage over larger brands as they made these multimillion dollar purchases and sales by themselves while sharing the most intimate secrets of their clients.
In the early 2000s, a wide range of diamond colors began to capture the attention of collectors, with these colors fetching some of the highest prices ever seen for fancy color diamonds. 2010 marked the year when new Chinese jewelry collectors noticeably gravitated towards fancy color diamonds. Prices peaked and set a new threshold for almost all colors that year.
As the market expands, emerging jewelers have the opportunity to establish themselves as reputable players by demonstrating a large offering with expertise in the fancy color diamond segment. This growth potential allows for increased competition and innovation, benefiting both consumers and industry participants
FANCY COLOR DIAMOND CATEGORIES
In this chapter, we will examine and map the different segments of color diamonds that are available for jewelers. We will explore the distinct characteristics of each segment and discuss the potential sources from which they originate.
Yellow Melée
Yellow fancy color diamond melée comes in a wide range of shades and saturations, ranging from fancy light to fancy vivid and deep. It also comes with various color modifiers such as orange, brown or green with clarities ranging from VS to I2. Yellow melée is popular amongst jewelry designers and can be seen in almost any jewelry category, including in luxury watches. With the increasing popularity of lab-grown diamonds, the jewelry industry is adapting its approach towards fancy color diamonds as well.
A similar category of diamonds can also be manufactured from yellow rough diamonds found in South Africa, but most of them will be with lighter saturations ranging from fancy light to fancy intense yellow, and a large portion will be in larger sizes from 2.5 to 3.2 millimeters although smaller size are available as well. Melée diamonds sourced from Sierra Leone typically offer larger sizes with a unique color sensation, ranging mainly from fancy intense to fancy vivid. The clarities of these diamonds usually range from VVS to SI1.
Pink Melée
Pink melée have been unearthed in the Argyle mine in Australia. These diamonds exhibit a range of intensities and sizes, ranging from faint to vivid, ranging from a “warm” orangey/brownish pink to a “cold” purple pink. Although the majority of these pink diamonds possess a blue fluorescent property, it does not impact their appearance. The size of pink melée diamonds typically range from 0.01 to 0.14 carats in all clarity grades. Rough diamonds that yield pink melée are no longer available.
Yellow fancy color diamonds, primarily in sizes ranging from 0.20 to 0.99 carats and in shapes other than rounds, constitute the second-largest section in terms of unit numbers, following melée diamonds. Each year, thousands of these diamonds, predominantly in cushion and radiant cuts with a smaller portion in other fancy shapes, enter the market, with the majority accompanied by GIA reports.
Yellow diamonds from 1 carat and above
Yellow fancy color diamonds in this category represent the most popular article. Lighter color and smaller sizes represent the entry level diamond in a single piece of jewelry while large yellow diamonds, or midsize intense and vivid yellow are coveted by diamond connoisseurs as they create a strong visual impact with their pleasant yellow color are considered to be quite rare. Exceptionally large fancy vivid yellow diamonds sometime fetch prices per carat, of light pink or blue diamonds.
Exotic colors – all sizes
We have divided this category into two groups. The first group includes colors that are either in their single form or diamonds that have a color modifier other than brown or gray. This group includes colors such as bluish-green, yellow orange, purplish pink, pinkish orange, as well as single-color diamonds like blue, red, purple, pink, green, and others.
Diamonds in this color section are typically found at top retailers and are sought after by savvy diamond lovers who recognize the long-term wealth preservation element or aim to differentiate themselves with their jewelry collection. Diamonds with these colors can reach the highest price per carat in the diamond market.
The second group comprises diamonds with an earthy-color palette, exhibiting a combination of brown or gray with other colors. Examples include fancy yellowish-brownish orange or fancy grayish green, among others. This group is considered to be more accessible in price but can still have a significant impact in a piece of jewelry.
JEWELRY RETAIL SEGMENTS
We recognized three groups of retailers that offer fancy color diamonds. The groups are not characterized by their turnover or reputation but rather by their business culture and the way they operate.
The first group comprises privately-owned, mid-sized independent jewelers, some of whom are authorized sellers of leading luxury watch brands. These jewelers are typically leaders in their respective geographic areas and incorporate fancy color diamonds into classic jewelry designs. Their sales teams are experienced, with some being owners or family members.
Generally, in this level, the owners of the company or very senior sales staff such as family members, are responsible for the multimillion-dollar fancy color diamond sales. When it comes to quality, these jewelers are not obligated to a structured policy but rather to what they find attractive, and avoid diamonds with certain properties relying on past experiences with clients.
