Market Overview

As we move into the busy spring season, perhaps the most active time of the year, we are expecting strong results at the major auctions around the world as well as strong momentum from investors who will be re-balancing their portfolios after their annual tax filing in most countries.

With the recent announcement of the strong growth of passion investments in the last decade, with rare jewelry prices up 138 % in the last decade and average colored diamond prices up over 70 % in the last decade, the establishment of strong momentum in the commodities market in general and more specifically rare hard assets should lead to solid results in the coming years.

In this issue, we will discuss some of the strong sales of major brands in an article from Forbes, before looking closer at rare pink diamonds as an investment. We will then discuss the growth and technical side of green diamonds before looking at some of the activity at the major auctions around the world.

Forbes

Besides the intricate and otherworldly outfits that parade down the runways during Paris Haute Couture Week, dazzling gems and baubles are also on display. Many of which are high jewelry collections design with exquisite jewels and take several expert hands to create.

As luxury jewelry becomes one of the growing areas for passion investments — surpassing cars even — it’ll come as little surprise that these extravagant pieces have been gaining interest —  even if they’re hardly ever worn out. From Sri Lankan sapphires to pieces inspired by the personality of lions, take a look at some of the latest collections luxury bigwigs released earlier this year.

Dior   

The latest Dior à Versailles, Pièces Secrètes collection takes you inside a secret Versailles to explore many unseen facets of hidden passages and mysteries. Many of the 36 creations are treasures in their own right, revealing secret features you would never think of and carrying the highest levels of savoir-faire the fine jewelry atelier could provide.  Take for instance, a diamond pivots on its axis to reveal a stone beneath a stone, while a ring is fitted with a hidden drawer, bringing to life the palace of secrets the collection takes inspiration from — Versailles. An exquisite ring fitted with a hidden drawer for a playful touch.

Chanel

Chanel “Timeless” brooch in 18 carat yellow gold set with a 1.01 carat round‑cut diamond, 21 fancy‑cut yellow sapphires, 44 round‑cut yellow sapphires and 251 brilliant‑cut diamonds.

Coco Chanel always had a special affinity with her star sign, Leo. Represented in the form of a lion, the animal is not only a common symbol in her home but has been used in many ways for her collections over the years. This time, the motif takes centerstage for Chanel’s latest high jewelry collection, L’Esprit du Lion.

Taking cues from the lion’s personality — strength and power — the collection features a range of bold pieces encrusted in jewels of warm colors, such as yellows, oranges and browns. Some signature pieces include the Chanel ‘Legendary’ necklace in 18 carat white and yellow gold set with more than 1,200 diamonds and one cushion‑cut 30.19 carat yellow diamond. While another is a secret watch framed with a 37.41 carat carved yellow beryl and 541 brilliant‑cut diamonds.

Boucheron

In celebration of the famed French jeweller’s 160th anniversary, the latest additions to their high jewelry collection are nothing short of mesmerizing. New jewels in the range include an update of the ‘question mark’ necklace as well as a continuation of the brand’s love for nature and animals. This time, expect to see new forms of bestiary like a wolf and a fox formed with diamonds, and brooches in the shape of parrots. Along with the same theme of nature,  the Plume de Paon — an iconic design — re-works the peacock feather motif to take the shape with lightness and follow the curves of a woman’s body.

Plume de Paon long necklace paved with lapis lazuli and diamonds, in white gold

Rosy future: investing in pink diamonds – The National, United Arab Emirates

High in demand and low in supply, the pink stones can be worth more than 10 times the price of their colourless counterparts

Estimated to command more than 10 times the price of their colourless counterparts, pink diamonds are pretty, precious and highly priced, and this all comes down to one overarching feature: scarcity.

“Even within the rarefied category of coloured diamonds, pink diamonds are extraordinarily rare,” says David Bennett, worldwide chairman of Sotheby’s international jewellery division. “To give you an idea, of all the diamonds submitted for testing at the Gemological Institute of America each year, fewer than 0.02 per cent are predominantly pink. As such, the finest examples have achieved some of the highest prices in the jewellery category at auction.”

Paul Zimnisky, an independent diamond analyst based in New York, adds: “If you are going to invest in a diamond, a nice pink is the way to go. The world’s primary source of pink diamonds, the Argyle mine in Australia, will be ceasing production by 2020 as its economic resource has been exhausted. This will keep supply limited and prices high

The Pink Star. Sotheby’s

As with all diamonds, colour, cut, clarity and number of carats greatly influence rate and resale value. Of these four factors, colour takes top honours when it comes to a pink stone. The trick is in the description: pink diamonds range from light to fancy, intense and finally vivid, which is the highest grade. Bennett reveals: “It is more and more important for collectors to make sure they have certificates for diamonds, and in particular a report from the GIA, because ultimately, the colour grading that the organisation gives is the most important.”

Hue is so crucial in this niche market that it’s even recommended that collectors sacrifice clarity and size for a better colour quality. One reason for this could be the tricky and sometimes subjective process required to identify precise shades. Stephen Wetherall, CEO of Australia’s mining company Lucapa Diamond, explains: “Estimating the exact shade of a coloured diamond is not that straightforward, even for an expert, let alone a normal consumer. Not everyone sees the same intensity of colour, and pink diamonds regularly have a second colour. For instance, you could have a browny pink or an orangey pink. Generally, two-colour pinks are sold for less than single-colour pinks. Clarity, which in a white diamond is very important, tends to be less so in a fancy coloured diamond with a very strong colour.”

Loose stones, too, are a worthy investment. Last month, Lucapa recovered from its prolific Lulo mine in Angola, a 1.9-carat pink stone alongside other rough diamonds. “While this is not the largest pink diamond recovered at Lulo – we have found a 39-carat light fancy pink in the past – we consider it to be in the top colour range. That is, the best diamond to be polished from this stone has the potential to be vivid in colour,” explains Wetherall.

Loose pink diamond. Courtesy Lucapa Diamond Company

He sheds light on the process behind getting the stones from mine to market, and what collectors should look into before purchasing a coloured stone. “To clean diamonds with internal dirt, dirt in cracks or harsh colour stains, we use a deep boiling technique. This involves placing the diamonds in a tantalum container, sealed in a special mix of chemicals and putting them in an oven at high temperatures for up to 12 hours. The acid vapours penetrate the inclusions and cracks and clean the diamond properly. This process is commonly used for white diamonds. However, for coloured diamonds, this process has been known to lighten the intensity and, generally, a less harsh acid and shorter cleaning process is used, or the stones are placed in ultrasonic baths.”

Once the stones have made their way to market, collectors and the experts who guide them can and must consider as many of these details before signing on the dotted line. And to all this, Bennett adds a final tenet. “Always buy something you like. You will get pleasure from owning a diamond that has personal appeal for you. And if you like it, there’s a good chance that others will too, should you one day decide to sell.”

Green Color in Diamonds: The Natural ‘Treatment’

By Daniel Howell Ph.D. Chief Scientist and Co-Founder, Diamond Durability Laboratory | 18.12.17

As the demand for green fancy color diamonds grows, professionals who market them will benefit from increased knowledge and key talking points about this rare type of stone. One such example being that a unique characteristic of green diamonds is the fact that they are the only type of diamonds that obtain their color long after they are formed.

This article summarizes the essential information that you need to know about green fancy color diamonds during the selling process.

Of all the fancy colours that diamonds can exhibit, green is the only one that can be naturally created once the diamond has been transported to the surface. All other colours are produced while the diamond is deep in the Earth under high temperatures and pressures, either by impurities in the carbon lattice (e.g. yellow, blue) or deformation of it (e.g. brown, red / pink). Natural green colour is the result of radiation damaging the diamond. This can occur when the diamond is still in the volcanic pipe (kimberlite) that brought it to the surface, or even if it has been eroded out from there and found in a river / alluvial deposit. If the diamond resides very near, or in contact with, another mineral or fluid that contains a high concentration of radioactive elements (e.g. uranium) then it can have an affect on it. The radiation emitted by the radioactive minerals or fluids, penetrates the diamond and knocks carbon atoms out of the diamond’s crystal lattice, creating holes or vacancies. It is this defect, or imperfection in the diamond lattice, that causes the absorption of predominantly red light, resulting in us perceiving green colour. Radiation damage can also occur when the diamond is deep in the Earth.

Sotheby’s Auction

Sotheby’s garnered $34 million across three sales that made up its New York spring auctions, with a rare fancy intense blue diamond ring standing out as the highlight of the event. The combined auctions were 83.3% sold by lot.

The cut-cornered, rectangular, step-cut 3.47-carat stone (pictured) set a price-per-carat world record for a blue diamond, selling for $1.9 million per carat at the Magnificent Jewels Auction, Sotheby’s said Friday. The $6.7 million final price nearly tripled Sotheby’s pre-sale estimate of between $2 million and $2.5 million.

Other top sellers were a 72.96-carat diamond bracelet, which sold for $1.4 million, and a 13.70-carat Tiffany & Co. diamond ring, which yielded $1.2 million, beating its estimate of $600,000 to $800,000. Among the lots that failed to sell were a 7.01-carat fancy intense pink diamond ring, estimated at $4.2 million to $5.2 million, and a 7.37-carat emerald-cut fancy intense orangey-pink diamond ring, evaluated at $3 million to $5 million.  The magnificent Jewels sale totaled $26.2 million.

Sotheby’s also brought in a total of $2.8 million at the Jeweler’s Eye auction of Fred Leighton’s personal collection, which included his jewelry, furniture and accessories. The event saw $1.6 million in jewelry sales, which featured emerald and ruby pieces.

The Fine Jewels sale totaled $5.8 million, and included a 52.89-carat sapphire and diamond ring by Cartier that fetched $6.2 million, the highest price ever achieved at a Sotheby’s New York Fine Jewels sale, the auction house said.

“It’s very encouraging to see the response to jewelry offered across all price points, which attracted a broad international group of buyers,” said Kendall Reed, head of Sotheby’s fine jewels in New York.

Christie’s to Auction 8 ct. Pink Diamond Ring

Christie’s New York spring sale will feature an 8.42 carat, fancy intense pink diamond ring, estimated at between $4 million and $6 million, the auction house said Friday.
The cut-cornered rectangular modified brilliant-cut, VVS1-clarity stone has the potential to be recut to internally flawless, according to Christie’s. Two tapered baguette-cut diamonds surround it on either side.
Other notable lots include an oval-cut 22.76-carat, D-color, type lla, VVS1 “thread” ring, designed by JAR, estimated at $2.5 million to $3.5 million, the sale of which will benefit the Art for Justice Fund.
The Magnificent Jewels event will also include signed period and modern pieces by Boucheron, Bulgari, Cartier, David Webb, JAR, Harry Winston, Tiffany & Co. and Van Cleef & Arpels.
Christie’s will sell the jewels in a live auction on April 17, as well as online from April 10 – 19. The auction house will preview the pieces at its Rockefeller Center galleries from April 13 to 16.

 

The information in this newsletter is for informational purposes only. The information contained in these quotes is believed to be from reliable sources. AIDC Advantage Corp. “the company” cannot be held liable for any misrepresentations on behalf of the sources we use. The company is not an investment advisor nor are they licensed to give investment advice. The company assumes that all buyers acquire colored diamonds for collectible and jewelry purposes as well as the long-term potential of the market. It is advised to contact a qualified advisor before entering into the colored diamond market. The company cannot guarantee that past performance of colored diamonds will continue in the future and that a colored diamond purchased from the company will provide a net gain. They are not as liquid as some collectibles. They are not necessarily appropriate for every individual. The quotes used only represent part of the article. For full viewing of any article, please contact your advisor. For more information, please refer to the terms & conditions in the AIDC Advantage website.