Diamond Investment 2020: Could now be the best time to buy & our guide to getting the best return

Noble Fine Jewellery's in-house Diamond Expert, Elie Chodos reveals why diamonds are still a great investment opportunity in the longterm

Even before Covid-19 shut down our global investment markets, the price of diamonds was already in a decline that was highlighted in November when DeBeers – the leading monopoly on rough diamond supply – announced a 5% decrease on their wholesale prices.

The cause for this decline is an ongoing (and lively) debate within the luxury market, with most sectors blaming the oversupply of stones due to the opening of three new diamond mines in 2016 and 2017.

Quite simply, there were too many diamonds coming out of the mines to retain their exclusivity and pricing.

And while the current prices for rough and polished diamonds are stagnant (with the possibility of a further fall before they rise), there are still potentially great investments to be made in diamonds if you have the cashflow and are willing to be patient.

Diamonds have always been resilient in terms of their strength and staying power (providing you take a longterm view), and now with a reduction in the supply of stones due to closing mines and mining operations (DeBeers have just announced they are cutting their 2020 production by a fifth), plus a breakdown in the supply chain thanks to the global pandemic – diamonds are predicted to see a price resurgence in the years to come.

Making The Best Investments

While the longterm future does look hopeful, the key to ensuring a return on your diamond investment will be in purchasing the right stones to guarantee a welcome return, and here is where the experts and industry insiders are able to guide their clients.

Having surveyed diamond dealers and jewellers as well as using my own 30+ years of experience in diamond sales around the world, here is our guide to making the best diamond investment today:

Rough vs Polished Diamonds: Unless you are an expert in diamonds and stones, it would be a potentially dangerous gamble to invest in rough diamonds unless you are confident in predicting what you can achieve after polishing and are able to see the colour and clarity through the rough. By choosing to invest in polished stones, it allows an investor to wear and enjoy their profit margin as it increases.

White vs Coloured Diamonds: 100% of our industry experts recommend coloured diamonds as being the best longterm investment, regardless of the current global market conditions. With a limited supply of stones, the price of coloured diamonds is guaranteed to increase as mining operations continue to become unviable.

The Argyll mine in Australia has already announced its closure, thereby cutting off their supply of famed pink diamonds. Plus mining in Zimmi (home to the famous intense yellow diamonds, see below) is only predicted to last another 10-15 years, thus ensuring a price increase as the supply decreases.

Stones vs Jewellery: the universal recommendation from our industry survey is to invest in stones when compared to jewellery pieces, unless the jewellery is from a limited collection signed by a well-known designer, or has come from a notable design house that may add value overall.

Prioritising The 4Cs: when considering what of the categories – cut, colour, clarity and carat – should be the priority for investment, the majority agreed that Colour is key above all else, followed by Carat, Cut and Clarity in priority order.

For more advice on buying and investing in diamonds, get in touch with our inhouse Diamond Expert Elie Chodos directly at info@noblefinejewellery.com. We are able to buy and sell diamonds as well as advise clients on the best investments to suit their budgets and investment requirements.

About Elie Chodos

Elie is a third-generation diamond dealer and has worked in the diamond world for over 30 years with extensive experience in the Asian, Russian and European markets.

He has worked with some of the largest global diamond organisations, including Tache, Asco Diamonds and SDE Diamonds where he was a Founding Partner. While at SDE Diamonds, he partnered with Star Diamond, Avi Shnur from Astra Diamonds and Schachter-Namdar.

Elie is also a member of the Antwerp Diamond Bourse and is the in-house Diamond Expert at Noble Fine Jewellery and Zimmi Diamond.