Diamonds are found in nature in a rich palette of colours. Clear ones are found most often, while the rarest of all are those of carmine (a dark red shade). Red diamonds are currently the most expensive in the world, and interest in them continues to rise.
When dealing in precious gemstones keep their origin in mind, their weight, colouring and lustrousness. A certain unnamed head of state in Eastern Europe not long ago paid 16 million US dollars for a 4-carat red diamond! This, however, is not the most expensive diamond in the world; that honour goes to the Millennium Star, a 203-carat diamond of colour D, which is a colourless gem without any chemical impurities.
This fame, however, is completely overshadowed by the diamond trader Laurence Graff, who in November 2010 at the Christie’s auction house in New York paid 1.86 million dollars per carat for a 24.78-carat pink diamond. The world believes that Graff’s 46-million dollar pink diamond is the holder of the world record, but “ourˮ red gemstone is still a step ahead.
The red diamond is undoubtedly the rarest and most expensive gemstone in the world. Only seven or eight of them are found on the market each year, in comparison with tens of thousands of colourless diamonds, which are sold from one carat in weight, which is roughly 1/9th of the size of our little gem. That’s why a 4-carat red diamond is really a unique gemstone, deserving our admiration. But only if this miracle does not have any other shade of red in it, for example, a brown or purple, but is simply a pure blood-red diamond.
The Big Players
At Christie’s auction house in 1987 a 0.95-carat purple-red diamond sold for 880,000 dollars, which is the equivalent of 926,000 dollars per carat. The merchant who decided to pay such a sum for this admirable stone was reportedly the Sultan of Brunei. This was a world record in terms of the most expensive gemstone purchase in history. Last year a 1.92-carat rare coloured Fancy Red diamond, of purity VS2 (with very small inclusions), was sold for 1,652,000 dollars. It found its happy owner at a millionaire’s show in Moscow.
Red and other coloured diamonds have taken a long road to the top of the gemstones market since 1956, when the Sultan of Brunei bought a 0.95-carat jewel called the Hancock Red for 13,500 dollars from collector Warren Hancock, which was huge money for this period. This sultan and his wife changed the future of coloured diamonds, when they went to the boutique of Laurence Graff in the Robinsons commercial centre in Singapore in 1967.
Like all exceptionally rich men, he had to decorate his other half and invest money wisely. Graff convinced him that a unique opportunity for investment and the growth of his money was hidden is coloured diamonds. This is and then was an opportunity to buy low and sell high. During the following decade Graff and the Sultan ruled the gemstones market, until the drama that occurred in 1980 at Christie’s auction house in Geneva. Then an unknown investor offered 127,000 dollars per carat for a 7.27-carat pink diamond, and immediately afterwards another offer of the most expensive Rosser Reeves ruby followed, which stunned everyone at 100,639 dollars per carat…
Stylish Clients
From that moment the prices for coloured diamonds began to rapidly climb. Asians, especially Japanese with unsuccessful investments on the Nikkei stock market, decided to make money on this alternative asset value. Every time the Sultan of Brunei decided to travel somewhere with his three wives, some diamond trader waited in hopes of doing business with him.
Today it is the Chinese and Indians who so adore and venerate coloured diamonds, among other things. They buy them because they believe that some shades will bring luck. All coloured gemstones, however, bring great profits, if one knows how to correctly invest and trade in them. Forty years ago, rubies, emeralds and sapphires were sold for a lot higher prices per carat in comparison with coloured diamonds.
At present, however, the value of coloured diamonds versus their “cheaperˮ competitors is very high. Long before investors and diamond traders put their money into these rare stones and turned demand on the market upside-down, Graff and the Sultan undertook their financial adventure, which pulled the price of red diamonds rapidly upward from 14,200 dollars per carat to an unbelievable 4,000,000 per carat at present. Pink diamonds climbed to 2,155,332, blue to 1,686,505 and yellow diamonds to 367,366 per carat. These data were recorded on the Asian market and relate primarily to smaller coloured gemstones in the range from 2.62 to 6.01 carats. All had a rich and lustrous colour; the price is a lot less for paler colours.
Asians Love Red
According to David Bennett, international director of the jewellery division at the auction house Sotheby’s, red diamonds are a great fashion in Asia. Greater demand for them began in Japan after 1990, and likewise in China and in other countries, such as India. The size of the stones may be a certain limitation. Customers from the Far East prefer diamonds of wearable sizes which can be embedded into jewellery. A coloured diamond of the same price as a colourless one, is however, much smaller. The custom in Asia is a combination of fashion and investment into various shades of diamonds. There is great social prestige in being proud, for example, of a 5-carat blue gemstone.
To acquire red and green diamonds is nearly impossible, even if you have millions of euro on your account. They are found only rarely in nature and really are unique, even though they are mined. And it is almost impossible to find a purely red high-quality diamond. Pink diamonds, which are today quarried mainly in Australia (up to 90% of worldwide production), are also perhaps disappearing, because next year there are plans to close this diamond mine. Mrs. Louise Kruger, a diamond-trader from the celebrated Mayfair part of London, has prepared a list of diamonds by colour, favour and demand. After red (the most requested colour) follow green, blue, pink, grey, yellow and brown. There are also white diamonds in a milky colour. Demand is greater for warm shades, for example, the demand for orange-pink over grey-pink shades.
A person who decides to invest several million euro from his or her account into coloured diamonds will not be sorry, because demand is rising and the guarantee that the expended money will not easily be lost is based on market statistics. For example, not long ago a lustrous blue diamond with an estimated price of 7,000,000 dollars awaited a new owner at the Sotheby’s auction house in Hong Kong!
Text: Michaela Mičatková, photo: Christie’s images Ltd. 2017
