Multimillion dollar art sales and NFT’s aren’t the only headlines coming from auction houses—important diamonds are proving to be a rock-solid investment too.
In a headline-making auction, Christie’s is offering three vivid colored diamonds, along with extraordinary colorless D flawless diamonds, gemstones, and signed pieces, at its Magnificent Jewels New York sale on April 13. A single vivid stone (which is the highest quality grade in a colored diamond) that is over two carats in size commands considerable attention, so to have three diamonds of this caliber is sure make it an active – and exciting sale.
But that’s not the only headline-making jewelry event on the foreseeable calendar. At its upcoming Magnificent Jewels auctions in New York on April 15 and Hong Kong on April 20, Sotheby’s will also present a stellar roster of distinctive diamonds—the kind of elusive stones that might not appear again for five or ten years, if ever—, including a 41.50 carat, D flawless, type IIA diamond with a presale estimate of $4.5 to $5.5 million.
“It’s just a beautiful stone with a life and depth that you don’t often see, even in a D flawless,” says Quig Bruning, Senior Vice President of Sotheby’s Jewelry Department in New York.
Why are so many exceptional fancy colored and colorless diamonds hitting the auction block in April?
Despite the pandemic, top-quality diamonds and gems have proven to be a strong category over the past year at auction houses and at luxury retailers, and that has motivated sellers.
“New wealth is created every day in spite of the pandemic,” explains Angelina Chen, Christie’s Senior Specialist in Jewelry. “There is a great appreciation out there for rare and valuable items; paintings have sold, digital art is hitting new highs and younger buyers are coming to the market voracious for information and education, and they want to buy.”
Sotheby’s had a number of important diamond sales in 2020, and this year is already off to a good start, says Bruning. “The mood is fantastic, and there is a degree of confidence and optimism, and a desire in the market to buy.”
The proof is in the results: important diamond transactions have been on an upwards trajectory for the past several years at Sotheby’s. Since 2015, the auction house had a sell-through rate of 100% for white diamonds over 40 carats offered at auction, with half of them achieving prices above their presale high estimates.
When it comes to these large top-quality stones and colored diamonds, Bruning explains ,“There is a growing understanding of their scarcity and complexities.” As a result, a growing subset of buyers who are watching prices rise see this as an alternative asset class and not just a sparkling accessory.
Also fueling competition is a wider global audience. As has been widely reported, people were stuck at home during the pandemic with more time to browse the internet; Sotheby’s and Christie’s were available to engage and guide them in art and jewelry acquisitions, as well as in building collections.
“We greatly expanded the circle of buyers and engaged new private clients around the world,” Bruning says, noting that Sotheby’s isn’t dependent on any one specific region for purchasing these large and important stones.
Diamonds as Investments and Wearable Assets
Clients buying stones on the level of Christie’s vivid colored diamonds appreciate the fact that these collectible gemstones are smaller in size, and that most people won’t know that they are a rare treasure. “People buying at this level already have a wedding ring,” explains Chen, “and they want another diamond, perhaps something with color, and something that they can wear every day.” She says that Asian buyers are especially interested in fancy colored diamonds, and that they understand the rarity of the stones.
In addition to the trio of vivid colored diamonds, Christie’s is also offering a 25.55 carat fancy vivid yellow diamond ring (estimate: $925,000 to $1.2 million), a 3.02 carat fancy vivid purplish-pink diamond ring offered without reserve (estimate: $1 million to $1.5 million) and a 6.56 fancy intense orangey-pink diamond ring (estimate: $700,000 to $1 million).
It’s not just colored diamonds making headlines. Christie’s is offering a 100.94 carat D-color internally flawless emerald-cut diamond at its Magnificent Jewels sale in Geneva on May 12. In the past decade, Christie’s has offered only two other diamonds of this exceptional quality over 100 carats, which is an indicator that the stone could fetch a record-breaking price. The pre-sale estimate is $12 million-$18 million. Discovered in 2016 in the Sakha Republic (Yakutia) in the northeast of Russia, Alrosa cut the stone in its workshop in Moscow, a process that took nearly two years.
A diamond has even greater value when it’s set in a jewel by one of the famous jewelry houses, like the two Cartier pieces that will be included in Sotheby’s Hong Kong sale. One is the L’Odyssée de Cartier Parcours d’un Style diamond and rock crystal bangle set with a 63.66 pear-shaped D color, internally flawless type IIa diamond (estimate: $5.16 million to $8.4 million), and the other is a 23.48 carat pear-shaped fancy deep pinkish orange diamond ring (estimate: $4.26 million to $6.26 million).
Rarity Drives Investment
Affluent collectors who are chasing down elusive paintings, sculptures, wines and watches are oftentimes the same people who appreciate what’s hardest to find in jewels. In diamonds, that includes stones graded type IIa, which are the most chemically pure stones with exceptional optical transparency; they are often described as appearing like pools of water. Both houses are offering exceptional examples of type IIa diamonds, including Christie’s 38.04 pear shape brilliant cut diamond ring, D color, flawless clarity, type IIa (estimate: $2.5 million to $3.5 million), and a 14.50 emerald cut diamond, D color, IF clarity, type IIa (estimate: $700,000 to $1 million).
Diamond grading aside, some stones just sing in a way that’s indescribable on paper, and that’s the case with The Buhl-Mann Diamond Ring, a 19.47 carat stone (estimate: $200,000 to $300,000) at Christie’s. “It’s a beautiful stone with so much personality,” says Chen. “It doesn’t matter that it’s an I color; this stone can talk to you.”
With so many extraordinary diamond jewelry pieces on the auction block, it’s easy to be distracted by the statistics and the grading reports. But, once you see the diamonds, you can see why people will pay millions for the jewels—they are simply mesmerizing. “These diamonds allow collectors to own, wear and enjoy something beautiful,” says Bruning. “They are also great storers of value and wealth.” In other words, it’s a win-win.