Precious stone Investments

The name diamond derives from the ancient Greek adamas ("invincible"). They have been treasured as gemstones since their use as religious icons in ancient India and usage in engraving tools also dates to early human history. Popularity of diamonds has risen since the 19th century because of increased supply, improved cutting and polishing techniques, growth in the world economy, and innovative and successful advertising campaigns. They are commonly judged by the "four Cs": carat, clarity, color, and cut.
Diamond prices vary widely depending on a diamond's carat, color, clarity, cut and shape. Unlike for precious metals, there is no universal world price per gram for diamonds.

The Market for Rough Diamonds

The rough (uncut) diamond market consists of three very different segments - "gem", "near-gem" and "industrial". Gem and near-gem diamonds are used in jewellery and can vary in colour from pure blue-white, through pale yellow and brown, to the rarest pink or blue diamonds. Industrial diamonds, because of their inferior quality or undesirable colour, are used in industry for cutting, grinding, polishing, drilling and other technical and scientific applications. Gem diamonds make up only 18% of world production by weight, but account for 66% by value. Alluvial diamond deposits typically have a high gem content, of 80% or above.

Approximately 75% of the world's annual production of rough diamonds is marketed through the De Beers – controlled Diamond Trading Company (DTC) which markets all De Beers production as well as production bought from other mines both on long term contracts and on the open market. The DTC aims to preserve an orderly market for diamonds and in the past has managed diamond prices by controlling supply in times of over production or economic recession. As a result, the diamond market has been less prone to the cyclical price fluctuations typical of many commodities. Rough diamond prices increased at an average annual rate of approximately 5% between 1985 and 2000, and substantially outperformed oil, gold and the Economist commodity price index over that period.