What You Need to Know About Investing in Pink Diamonds

Investors have used precious metals and gemstones to create wealth for centuries. These resources have long been seen as a symbol of prosperity, but they also hold a number of functional uses that make them increasingly valuable.

Diamonds are some of the most popular investment instruments in the world. They’re rare, valuable and relatively stable, making them a secure way to store your money and grow your wealth.

Within the diamond industry, pink diamonds are some of the most valuable gemstones in the world. They’re a popular choice for jewellery settings, but they’re also a smart choice for anyone looking to invest their money.

While all diamonds have value, coloured stones are prized by collectors. The additional rarity of these diamonds allows them to command higher prices, and helps to insulate them from market fluctuations.

But diamonds come in thousands of shapes, sizes, colours and weights. Each of these factors can affect the value of the gemstone, as well as its ability to maintain that value over time.

In this article, we’ll discuss some of the things you need to know about buying pink diamonds for investment, and how they stack up against white diamonds in the open market.

What are Pink Diamonds?

Pink diamonds are a type of coloured diamond that are only produced at a handful of mines across the world. The process for creating pink diamonds isn’t fully understood, which increases their rarity and value.

While red diamonds are the rarest type of coloured diamond, pink diamonds aren’t far behind. Their rarity is further increased by an extremely limited market supply.

Current theories suggest that the pink hue of these diamonds is caused by a misalignment of the carbon molecules within the stone. The misalignment alters how light is refracted, creating a pink tone.

This is very different from other types of coloured diamonds, which generally get their colouration from trace elements trapped within the crystalline structure.

Where are Pink Diamonds Mined?

The majority of the world’s pink diamonds come from a single source – the Argyle Diamond Mine, located in Western Australia. At its height, the Argyle mine was the largest diamond mine in the world, producing over 750 million carats of rough diamonds in its lifetime.

One of the unique features of the Argyle mine was that it produced a steady supply of high-quality pink diamonds. In fact, it’s estimated that more than 90% of the world’s pink diamonds came from the Argyle mine.

While the mine has now ceased operations, its pink diamonds are still highly sought-after.

These days, new pink diamonds are produced in relatively small quantities from sites located in India, Russia, Brazile, South Africa and Canada. The pink diamonds found in these locations are typically smaller in size and lack the rich colouration of gemstones that came from the Argyle mine.

What to Consider When Purchasing Pink Diamonds

Pink diamonds are subject to the same grading scale as all other diamonds. This pricing scale is based on the 4Cs of diamond grading:

• Cut – Diamonds are cut into shapes that capture and reflect light, causing the stone to sparkle. The quality of the diamond cut affects its value. Generally speaking, diamonds that are cut with greater accuracy are valued more highly, because they produce a superior “sparkle” effect.
• Colour – Pink diamonds range from very faintly coloured, all the way through to vivid, deep pinks. The more intense the colouration, the more the diamond will cost. Pink diamonds that demonstrate too much red or purple colouration are not as valuable as diamonds that are pure  pink.
• Clarity – The clarity of a diamond refers to any internal defects in the stone. Internal defects and occlusions can affect its ability to reflect light and sparkle. Clearer diamonds are more valuable.
• Carat – Carats are a measure of diamond weight. As the diamond gets heavier, it becomes larger and more expensive. Many of the current pink diamond mines are producing relatively small stones that have lesser value than gems that came from the Argyle mine.

How the Value of Pink Diamonds Has Changed

The rarity and beauty of pink diamonds has made them incredibly valuable as investments and in jewellery. Current estimates suggest that pink diamonds are valued at 10 times more than white diamonds.

The value of pink diamonds is also increasing. In 2022, the Argyle mine released its remaining stock of pink diamonds. Since then, it has produced no new diamonds, and the market price has increased accordingly.

We’re also expecting the value of pink diamonds to continue rising sharply. As they become more scarce (and as more diamonds are set into jewellery), the market price will skyrocket.

Pink Diamonds as Jewellery

Diamond collectors often place incredible value on coloured stones. Their unique nature makes them ideal as investments, because their value is more stable than white diamonds.

But coloured diamonds are also highly prized as jewellery gemstones. One of the best ways you can use a pink diamond is to set it into an engagement ring. This is a great way to show off your collection, and it won’t impact the value of the diamond.

Pink diamond jewellery is said to symbolise femininity, romance and grace. They look fantastic when set into metals such as yellow gold, white gold and platinum, which enhance the natural colouration of the gem.