FAQ - FREQUENTLY ASKED QUESTIONS

 

Q - Are coloured diamonds natural / are coloured diamonds real?

A - The coloured diamonds sold by The Coloured Diamond Exchange are 100% real, natural coloured diamonds.

Q - How do coloured diamonds get their colour?

A - Mother Nature's ability to capture the "fancy" colours in diamonds only took about 50 Million years - but it was worth it! Trapping different elements in the carbon during their formation gives us a rainbow of diamond colours.

Boron causes the blue diamond. Extremely rare - maybe 1 in 200,000 diamonds will have any trace of blue. Nitrogen is responsible for the spectrum of fancy yellows. It's radiation that usually causes the beautiful, rare and unusual green diamond, although sometimes it's due to an over exposure to hydrogen. And it's thought that stress in the diamond induced by the diamond material making its way to the surface of the earth or by tectonic forces causes the very rare and very popular pink to red diamonds.

More than 300 colours have so far been identified, and keep in mind that these include an infinite number of shade and hue combinations.

Q - Which coloured diamonds are the rarest?

A - Red is by far the rarest colour of coloured diamonds. There is said to be less than 30 red diamonds know to be in existence. After red would be blue and green. Keep in mind though that all coloured diamonds are extremely rare.

Q - Are coloured diamonds graded the same way as a colourless / white diamonds?

A - They are graded the same way but with one difference. One of the "4 C's" is Colour. Colourless diamonds are graded for their lack of colour whereas coloured diamonds are graded for their saturation of colour.

Colourless diamonds are graded alphabetically from D - Z. The highest grade is "D" for a colourless diamond. The "D" grade means the diamond is about as clear and colourless as possible. For coloured diamonds the grading is completely different for colour. The highest grade assigned is the grade of "Fancy Vivid". This indicates a perfect, deep, rich saturation of colour.

Q - What is the system used for grading the colour in coloured diamonds?

A - As mentioned above, the highest grade assigned to a coloured diamond is the grade of "Fancy Vivid".

The Gemological Institute of America ("The GIA") developed a standard system that uses nine categories to grade coloured diamonds. This is a universal system. The nine categories to grade coloured diamonds are Faint, Very Light, Light, Fancy Light , Fancy, Fancy Dark, Fancy Intense, Fancy Deep and Fancy Vivid.

Q - What makes coloured diamonds such a popular investment strategy?

A - Ultimately it's basic supply and demand. Out of 10,000 carats of diamonds only 1 carat will be fancy coloured. Some of the largest mines in the world are petering out and being closed. DeBeers closed 3 mines in 2006 and Australia's Argyle mine, which produces 90 - 95% of the world's pink diamonds is said to be finished producing by 2018 - 2020. Once their production of pinks ceases, supplies will dry right up. Demands increase every year and supplies are dwindling. It's a commodity that screams appreciation.

Compare what's happening now with pinks to what's already happened and happening with blue diamonds. In recent years, the principal mine producing blue diamonds (The Premier Mine, formerly the Cullinan Mine) passed its peak production capacity, causing a significant decrease in the supply of blue diamonds. This caused their price to go through the roof! Additionally, vivid blue diamond auction prices have been continuously breaking records, a trend influencing coloured diamond prices throughout the value chain.

Supply and demand.

Q - What coloured diamonds offer the greatest profit potential?

SHORT ANSWER: Any Size Argyle Pink Diamond and Fancy Intense Yellow Diamonds at least 2.00 carats in size.

LONG ANSWER: Our opinion is that yellow diamonds may offer great opportunity to a very broad spectrum of investor but pink diamonds currently possess a really unique attribute. On the one hand, high grade yellow diamonds offer great promise and are considered more "affordable" than their pink counterpart. Rio Tinto's Argyle Mine, which produces somewhere around 90 - 95% of the world's pink diamonds currently only produces a handful of high quality pinks each year and is scheduled to "peter out" over the next 6 or 7 years.

The model of "supply and demand" certainly suggests pink diamonds could skyrocket in price once no more are being produced. The past two decades have shown prices soaring for these little miracles of nature. With that said, their potential cannot be ignored...and isn't being ignored as anything pink is highly sought after. Yellow diamonds are starting to set all kinds of records around the world at auctions and offer great potential as their popularity globally is tremendous and supply wise, they haven't reached the level of pinks, blues or greens.

Q - Are coloured diamonds more expensive than colourless / white diamonds?

A - Yes, generally they are. Natural fancy coloured diamonds are essentially an extremely rare mistake of nature. Their quality is graded and depending on the rarity of the stone's colour, and/or clarity, and/or carat weight and/or cut you may find a diamond the size of your fingernail fetching millions of dollars.

Q - Can "The Average Joe" afford a coloured diamond?

A - Absolutely! The flexibility in the coloured diamond market makes it perfect for anyone to get involved. The spectrum is broad enough that, for example the very popular coloured diamonds referred to as "Champagne" and "Chocolate" (currently available in jewelry stores all over the world!) can be acquired at costs 50% lower than white / colourless diamonds of the same quality.

Q - Are coloured diamonds ever used in engagement rings?

A - The combination of rarity and uniqueness has actually made coloured diamond engagement rings very trendy. Plus, every so often in the news we see celebrities being caught by the paparazzi showing off their dazzling new pink or yellow engagement rings. Those two colours seem to dominate that category of jewelry. If you want to stand out from the crowd, contact one of our Consultants today about coloured diamond jewelry.