Historically, fancy colored diamonds and precious gemstones have shown significant long-term appreciation, especially when compared to more traditional investments. This documented performance combined with the unique attributes of rare diamonds and gemstones makes them a very attractive compliment to any portfolio.

Their highly concentrated, durable and portable characteristics afford rare diamonds and gems flexibility and mobility unlike a painting or summer home. You can literally pinch a multi million dollar asset between your thumb and forefinger or place it in your shirt pocket. More commonly stored in a safe deposit box or set in jewelry, these wearable assets allow you to also enjoy the prestige of owning a rare diamond or gemstone that is inherently more resilient to market fluctuations than traditional assets as a result of both their rarity and tangibility.

Famously measuring 10 out of 10 on the Mohs Hardness Scale as the “hardest substance known to man”, diamonds present the unique quality of immense durability in an asset that can be enjoyed without consumption or causing depreciation.

Highlights:

Fancy Intense Pink Diamonds over 3 carats appreciated 443% between 2000 – 2012 compared to gold (400%), the Dow Jones Industrial Average (60%) and traditional real estate (20 – 40%). – Knight Frank Luxury Investment Index

A 10ct Fancy Vivid Purplish Pink diamond is a 1 in 36 million occurrence when compared to diamonds of similar characteristics, only enters the market every 16 to 20 years and has appreciated 437% since 2005. – The Fancy Color Research Foundation

Over the last 20 years top tier fancy colored blue diamonds have increased in value approximately 250%, green diamonds 350% and pink diamonds over 400%. – Bonham’s, Christie’s, Sotheby’s, Rapaport, Reuters, Forbes, Barrons, FCRF

Over the last 20 years top tier rubies have increased in value approximately 350%, sapphires 400% and emeralds over 500%. – Sotheby’s, Bonhams, AGTA, Rapaport, USGS, National Jeweler

Most fancy colored diamond sales take place at “High Jewelry” auctions hosted by the likes of Sotheby’s, Christie’s and Bonhmas. On average, approximately 88% of the lots at these auctions actually sell, demonstrating the popularity of these rare and tangible assets in the marketplace. Further demonstrating the current high demand for these rare and tangible assets, an astounding 100% of the lots sold for $72.3 million at the Christie’s Magnificent Jewels Sale on May 14, 2025 in Geneva. – Christie’s

Based mainly on their intrinsic rarity and tangibility, fancy colored diamonds and precious gemstones have proven to be less volatile, even recession proof, without any major reductions in value during the past 40 years. This is why savvy investors leverage the pragmatic benefits of tangible assets like these, especially during times of global economic and political uncertainty, transitioning portions of their portfolios away from traditional stocks, bonds and real estate which are historically subject to market fluctuations. – FCRF, JustLuxe

Unlike stocks, bonds, vintage cars or rare wine…highly concentrated and durable fancy colored diamonds and precious gemstones can be seen, touched, worn and enjoyed without experiencing any significant depreciation, but rather appreciating the longer you hold it. – GIA, Beyond4cs

Things to Consider:

While no one would recommend fancy colored diamonds and precious gemstones make up the majority of an asset portfolio, they certainly deserve a portion with most financial advisors recommending 5 to 10%.

These natural tangible assets on average have proven to appreciate at 16 to 20% per year.

Fancy colored diamonds and precious gemstones do not represent a get rich quick scheme, they are best suited for patient investors looking at 5 – 10 year investment cycles.

Always consider the finest specimens of each stone and only those that are graded by trusted certification houses such as GIA, Gubelin or SSEF.

Important characteristics of fancy colored diamonds include straight color or stones with popular contributing colors, high saturation and of course carat weight. There are significant thresholds in value and appreciation once you cross over 1, 3, 5 and 10 carats.

Consider that an exit strategy could include private buyers, auction houses or niche dealers and sales cycles may take 3 to 6 months to optimize return on investment versus a fire sale.

Of course, the best approach would be to acquire the most coveted specimens, enjoy their unique tangible characteristics and ultimately transfer them securely to the next generation.