High-price purchases of colored diamonds by investors have become more commonplace in recent years, according to a report in the the Wall Street Journal quoted by IDEX Online.
The interest of Investors in colored diamonds is “part of a boom in niche over-the-counter luxury markets that were once the preserve of wealthy collectors”, as per the report. From 2009 to September 30, 2016, the price of pink diamonds has increased nearly 180% and is now at a record high. According to the Fancy Color Research Foundation, based in Tel Aviv, blue diamonds prices have risen 70% and yellow diamonds prices have risen 90% during the same period.
According to the paper, “Interest in colored diamonds, as with other luxury markets, is due to extremely low interest rates which have pushed returns on many government bonds below zero”. Eden Rachminov, managing partner of Tel-Aviv-based Rachminov Diamonds, is interviewed in the piece and claims that there has “absolutely” been a growth in the number of investors buying colored diamonds. Rachminov noted that 12% to 15% of deals are done at auction, with the rest being private sales or tenders.