Investment Diamonds.pdf

© DALBY DIAMONDS JUNE 2020



D I A M O N D S









F O R I N V E S T O R S & C O L L E C T O R S











NATURAL




FANCY




COLORED





DIAMONDS























How To Invest













3 STEPS TO GET

STARTET




Choosing the right colored diamond
for investment is a skilled job.

content














03
Welcome Letter


04 Vision




05
Investment Highlights



07
Argyle Mine



08 Rare Resources, Rising Values, Rarity Data



11
Return On Investment



13 Performance Against Capital Markets



15
Supply & Demand Outlook



16 Global Diamond Market




17 An Asset Transformed Into Jewelry




19 Passion Funds & Exchange Traded Funds



22 Anonymous Ownership



23 Valuation, How To Invest




25
Exit, Investment Network

Diamonds Are Non-Monetary,



Highly-Portable Assets.



- Forbes




















































The cause for the pink color in natural fancy pink diamonds still

remains a mystery. It is largely assumed to be the result of the
extraordinary pressure beneath the Earth's surface that the
stones were forced to endure over a tremendous amount of

time. The pressure brought the stones closer to the surface,
thereby altering their structure and making them refract light and
produce color.

Fancy color diamonds remain the top wealth 20













FEAR OF THE CORONAVIRUS'S

IMPACT ON GLOBAL GROWTH HAS

ROILED MARKETS. WHAT SHOULD

INVESTORS CONSIDER AT

UNCERTAIN TIMES?





WELCOME LETTER FROM TH E GLOB AL

DIAM OND GURU™



concentration investment vehicle during uncertain
times.
In the last 20 years, the prices of fancy color

diamonds and especially pink diamonds have
skyrocketed, making them popular among

investors and celebrities who enjoy the mobility of
a stable, high value asset that will continue to yield
an almost guaranteed return.


Dwindling supply and a surge in the demand for
rare diamonds indicate that the prices of these

wondrous natural treasures will continue to
increase. If you too seek to buy fancy color
diamonds, here you will find all the information,

tips and tools needed for making a smart
investment in one of the more popular assets of
recent years.







Sidsel Dalby, Gemologist(G.G. GIA); Founder of
Dalby Diamonds Incorp.


03

020






VISION




Protect and



increase your




wealth







Diamonds have throughout history been used

as a method of capital preservation, wealth
accumulation, as well as a stable high growth
asset class against a backdrop of global

market volatility. While gold and silver
fluctuate in the market, demand for
alternative investments is growing more than

ever, investors are purchasing diamonds as a
way to counteract impending inflation.
Fancy color diamonds and larger white

diamonds may be the last tapped natural
resource to turn into a broader financial

instrument.
Learning how to acquire diamonds can help
you expand the diversification of your assets.


Fancy color diamonds with especially pink
diamonds, considered to be the rarest of the

rare, are the most sought after, the ‘must
haves’ for investors and private collectors
with an eye for profit.


Review on pink diamonds by The Telegraph.






04

INVESTMENT     HIGHLIGHTS




















RARE INVESTMENT OPPORTUNITY



Be them pink, blue, green or orange diamonds are
very rare, very special and very sought after,

making them a great investment. Fancy color
diamonds offer many advantages to investors: a

hard asset that can hedge against inflation and the
devaluation of paper money. Low correlation to
other asset classes and almost zero correlation to

equities.


INVESTMENT NETWORK



The unique and uncommon nature of colored
STRONG MARKET TRENDS
diamonds is underscored and enhanced by the

Fancy color diamonds as investment offer an secrecy surrounding a rare colored diamond when
incredible opportunity to profit over the long term it appears on the market.

as the supply & demand balance is more acute Only 15% of colored diamonds for sale are
than in the white diamond market. Supply is purchased at auctions. In many mines, the best
exceedingly tight due to shut-down of the world's colored diamonds, typically around only 50

largest source of fancy color diamonds – The annually, are sold through sealed bids in an annual
Argyle Mine. Only 1 in 10.000 carats mined are tender.

fancy color and for every 100.000 diamonds Investors must be invited to the viewings, which
unearthed there will be just 1 diamond of the finest are held at secret locations in London, New York,
color and intensity according to the GIA and the and Hong Kong. These secret viewings of the
Fancy Color Research Foundation. So very little world’s most expensive colored diamonds create a

supply enter the market each year. covert ultra niche market accessible only by the
initiated - which significantly enhances the stone’s
allure and perceived value.
Dalby Diamonds Investment Network connects the

‘secret society’ of rare off-market diamonds with
investors and private collectors.
05

INVESTMENT      HIGHLIGHTS




















PORTABILITY



Diamonds are obviously very portable. They
actually have the highest size to value ratio of any
natural resource or any other investment good.

Several millions of dollars worth of diamonds can
fit in one handful and can be transported in your
pocket. In the world we live today portability and

stability serve as major advantages for diamond
investment. Life can change abruptly and having
such concentrated portable assets is a source of
NO MAINTENANCE FEE
comfort and security.


Diamonds have no maintenance costs during the

investment period. Diamonds are the hardest
material on earth, literally, so they don’t need
SECOND HAND MARKET
repairs or renovations over time. There are no
surprises with diamond investment, what you pay
OPPORTUNITY
upfront is the only sum you need to worry about.

Unless new mines are discovered in the near

future, colored diamonds will be even more rare
than they are now - and considerably more

valuable. By the time your grand children buy their
first diamond most mines will have reached the
end of their life cycle and the vast majority of

diamonds will be sourced from the second-hand
market. These circumstances will make the pre-
owned diamond arena the largest “mine” in the

world.






06

ARGYLE MINE




The end is near








The Argyle Mine has been, until now, the and its operators, Rio Tinto, have decided to

world’s richest source of fancy colored wind operations down.
diamonds and responsible for mining 90% of
the world supply of rare fancy colored https://business.financialpost.com/commoditie

diamonds. s/mining/jewelers-are-already-nostalgic-for-
the-end-of-pink-diamonds
Famed for its pink diamonds, it has also given

us other fancy colored diamonds, including Pink diamonds are in the news: breaking

the yellow diamond, blue diamonds, purple records at auctions, turning heads in million-

diamonds, and even the very rare red dollar celebrity engagement rings, and being
diamond. The Argyle mine, however, will named “the world's hottest gemstone” by The
close ultimo 2020. The number of gem quality New York Post.
diamonds it is estimated it can still yield is

limited,














































07

RARE




RESOURCES



Rising Values









One of the biggest advantages of alternative There is also the fact that the fancy colored
investments like colored diamonds is that diamond market is never likely to become in
they are not tied to the performance of the anyway oversaturated. Although they may be

stock market and so add diversity to an more recognizable to the average jewelry
overall personal investment portfolio that 21st aficionado now, thanks in part to their
century financial advisors recommend almost popularity with certain very visible celebrities,

across the board. They are also, of course, a they are all still extremely rare, and the
physical asset that can be held (literally) and known supply of certain colors is decreasing
will not lose their value quickly, as is the case rather than increasing. But which colors of

in some of the current bond markets, which diamonds are those?
are once again seeing a significant
slowdown.

.





PINK STAR DIAMOND
59.60 Carats

Fancy Vivid Pink Internally
Flawless
$83.2 Million













THE APOLLO & ARTEMIS
DIAMONDS
14.54 + 16.00 Carats
Fancy Vivid Blue Internally
Flawless
Pink Fancy Intense VVS2
$57.4 Million

08

RARITY DATA






Natural Pink Diamonds











The pink diamond – one that is certainly a big HNWI see rare diamonds as a wise investment,
favorite with collectors and even with those “one hundred percent”, says Sameer Lilani,

purchasing high end jewelry purely for the purpose Amrapali’s EMEA director.
of wearing diamonds – has lagged behind some of Source: The Daily Telegraph 20 May 2020
the other fancy colored diamonds in the past but
that is all likely to change in the coming years.




















































09

Natural Blue Diamonds











Blue diamonds represent only 0.5% of all fancy
color diamonds. The percentages of blue
diamonds mined each year is truly negligible, with

only a few stones unearthed annually. Among all
diamonds submitted to grading labs, only 3% are
natural fancy color.


According to the NCDIA, only 2 to 4 major blue
diamonds are released to the market every year.






1 0

RETURN



On Investment







It has been a bullish decade for the fancy color The prices of Blue diamonds rose by 81% and of

category. Over the past decade, the lucky few Yellow diamonds by 21%. The investment forecast
capable of owning rare fancy colored diamonds of diamonds predicts that valuations are only set to
achieved significant return on investment: rise as diamond production is set to to drop

According to data published by the Fancy Color significantly within the next 20 years.
Research Foundation (FCRF) the general Fancy
Color Diamond Index showed a steady market

price increase of 77% from 2009-2019. Leading Source: The Fancy Color Research Foundation
the index during the decade were Pink diamonds,
which increased by 116%.























































1 1

PRICE PERFORMANCE ON PINK

VS BLUE




Polished Blue Diamonds

2005-2019

241% Total appreciation all sizes





Polished Pink Diamonds

2005-2019

366% Total appreciation all sizes




Source: Fancy Color Research Foundation






FOLLOW US

12

PERFORMANCE




Against Capital



Markets






































LONG TERM INVESTMENT





Diamonds are like real estate suitable for investors The real estate market history is full of “bubbles”
who are not looking for fast returns on their crashes. Unlike the real estate market, the

investment. In each case, you risk losing money if diamond market has proven to be much more
you try to “flip” your investment. stable, so colored diamond investors incur less of
a risk.

Colored diamonds do appreciate in price relatively
quickly, but it would still be wise to let them "Despite the expected recession globally, we
“mature” enough that the investment return would believe the fundamental outlook for the diamond

be much more substantial. industry is very strong long-term."
– Bain & Company Inc. 2019.








1 3

PRICE PERFORMANCE ON PINK

VS BLUE





































1 4

SUPPLY & DEMAND



Outlook















































“The other area where we are optimistic is the diamond industry, thanks to supply and demand

dynamics. The emergence of the EM middle class means demand is rapidly increasing as


consumers purchase diamonds for jewelry or as a store of wealth. However, supply is

relatively constrained and unlikely to keep up with the demand; the diamond market is

consolidated among just a few players.” Mark Kiesel PIMCO


























1 5

THE GLOBAL



Diamond Market









THERE ARE 6 MAJOR DIAMOND HUBS IN THE WORLD




































The global diamond market size is anticipated to reach USD 123.83 billion by 2030, expanding

at a CAGR of 3.0% over the forecast period, according to a new report by Grand View

Research, Inc. The market is mainly driven by strong jewelry demand from emerging

economies.




The global diamond industry is USD based, regardsless of where diamonds are traded and

enjoys the stability that USD offers.




Source: MarketsInsider, Bain & Company 2020.














1 6

AN ASSET THAT CAN APRRECIATE




When Transformed Into Jewelry













































The global diamond market size is anticipated to reach USD 123.83 billion by 2030, expanding

at a CAGR of 3.0% over the forecast period, according to a new report by Grand View

Research, Inc. The market is mainly driven by strong jewelry demand from emerging


economies.

Diamonds will always remain a luxury item, with
classic and eternal beauty. You always get
The global diamond industry is USD based, regardsless of where diamonds are traded and
enjoyment out of your dazzling diamond set in that
enjoys the stability that USD offers. special piece of jewelry.





Source: MarketsInsider, Bain & Company 2020.

















1 7

Personal luxury and diamond jewelry spending is skyrocketing in developing markets of China

and India. These markets are in particular seeing a growth in the ranks of newly made and young
millionaires, who are on average under 40 years old. These youthful, nouveau riche investors
don’t only want to secure their wealth, they want to do so in style.





Source: Bain and Company















1 8

ALTERNATIVE




INVESTMENTS





And Passion Funds








It’s clear the marketplace has transformed. One of

the drivers is a surge in loose colored diamonds
being purchased as investments to serve as

discreet, valuable, and lucrative assets.

Investors include professionals and funds investing
on behalf of HNWI clients who buy colored

diamonds as alternative investments. This new
demographic of investors has significantly

expanded the diamond market, traditionally
dominated by rare gem collectors and
connoisseurs.



They’re investing increasingly in what are coming
to be called “passion funds”, long-term

investments in tangible and usually rare assets.
These investments appreciate over time and are
generally safeguarded against unpredictable

inflation or market fluctuations. Passion fund
goods include fine wines, works of art, collectible
musical instruments, as well as rare colored

diamonds. In addition to guaranteeing high
returns, part of the enticement of these niche
investments is that they are luxurious and reflect

the social status of their owners.

A significant advantage of diamonds over other

passion fund investments is that they are an asset
that investors can actually use and enjoy at no cost
or depreciation to the asset itself.


1 9

Investments of passion









































































2 0

EXCHANGE TRADED



Diamond Funds









One possibility for buying diamonds for investment Another opportunity is exchange traded funds

is to purchase a stock in publicly traded companies EFT’s that will be backed by diamonds. Since it is
Investments of passion
focusing on diamond production. Among those not currently functional, it is hard to analyze the
companies are ALROSA, Gem Diamonds, Harry feasibility of this kind of diamond investment.

Winston and Petra Diamonds.
Physical diamonds have certain characteristics
The benefits of this investment are that it is very that provide additional benefits to the investor,

passive and does not require investors to actively such as portability, security, aesthetic pleasure and
participate, they only entrust the operations of the social status that comes with owning

given company and carry the risks that come with exceptional stones.
the performance of the company. Source: Edan Golan Diamond Researc Data Ltd.




















































21
03

PRIVATE




PURCHASES





Anonymous Ownership









The discretion and anonymity that surrounds the

viewings, and which are so valued by the often
immensely private ultra rich investors, continues

throughout the purchase process.

Diamonds are an extremely discreet investment:

transactions don’t need to be registered with
government agencies or financial institutions.
Ownership can even be anonymous if the investor

so prefers.

Additionally, Fancy color diamonds are easy to The Pink Legacy Ring on 18.96 carats

transport privately. Diamonds have a high size to was sold on 13 November 2018 at
value ratio: as they are so small, they are highly Christie’s in Geneva for $50.66 million.
portable, which makes it easy to transfer wealth.






































2 2

VALUATION




Of Colored Diamonds







Investments of passion

There are three simple steps to determine a diamonds value
and avoid getting ripped off when buying colored diamonds:



Choose a colored diamond with certificate from Gemological
Institute of America(GIA) only.


Learn and understand the 4 C’s of diamond quality to
determine the value of the diamond shown in the certificate.


The most basic pricing principle in the world of natural
diamonds, whether fancy colored or colorless, states that the

rarer the diamond, the higher its value. There is no
predetermined linear scale that gradually dictates the
diamonds’ pricing. Each diamond has its own unique features

and its price will be determined according to their regularity or
rarity. Find a fair and honest retailer or even better an
independent diamond dealer who will help you understand

the true value of colored diamonds!










CONTACT US

Diamond Valuation

+45 7172 7274


[email protected]  







23
03

HOW




To Invest













Choosing the right colored diamond for investment is

a skilled job. It is our recommendation that clients
interested in investment grade diamonds consider
color, clarity, cut and carat together with a budget

before they contact us for further assistance or a
diamond price quote.










Book a free consultation for guidance with an

investment strategist




Investment grade diamonds will be

recommended – matching your preferences and

budget



The diamond can be studded in a ring or any

kind of jewelry and enjoyed, or kept loose in a

box at your secure facility















2 4 03

EXIT




Liquidity










There are several ways of selling diamonds. Digital online platforms have increased the access
and visibility of diamonds to a broader segment of clients. The change of ownership of a particular
diamond can be done globally and not only within your own community.



Dalby Diamonds procure the diamonds for the investor as a physical asset. At the time of
liquidation, the investor may give mandate to Dalby Diamonds to facilitate ownership changes of

the diamond to achieve the most advantageous exit from the investment. The intent of this
structure is to enable the investor to timely liquidate the asset at an attractive market price.



























































2 5
03

Anonymous Ownership
DALBY DIAMONDS





Investment Network











As diamonds are a non-renewable resource, a precious mineral formed

through millions of years of creation, the availability of diamonds on the
market is dependent on existing deposits, which are being depleted at a
much faster rate than there are being renewed.


Unless new mines are discovered in the near future, colored diamonds will
However, investing in diamonds is a complex decision. Learn more about each colored
be even more rare than they are now - and considerably more valuable.
diamond in our Colored Diamonds Wiki, or consider speaking to our investment
experts for pre and post valuation services.
However, investing in diamonds is a complex decision. Learn more about
If you’ve made up your mind to join the club of elite investors seeking recession proof
each colored diamond in our Colored Diamonds Wiki, or consider speaking
investments, get one step closer to your invaluable investment with Dalby Diamonds
to our investment experts for pre and post valuation services.
Investment Network.
Contact us for further information.
If you’ve made up your mind to join the club of elite investors seeking
recession proof investments, get one step closer to your invaluable
However, investing in diamonds is a complex decision. Learn more about each colored
investment with Dalby Diamonds Investment Network.
diamond in our Colored Diamonds Wiki, or consider speaking to our investment
experts for pre and post valuation services.
Contact us for further information or book an appointment at our
If you’ve made up your mind to join the club of elite investors seeking recession proof
Copenhagen or London Showroom.
investments, get one step closer to your invaluable investment with Dalby Diamonds
+45 7172 7274 // +44 207 157 9717
Investment Network.
[email protected]
Contact us for further information.
www.dalbydiamonds.com








2 6

A B O U T


D A L B Y



D I A M O N D S







Dalby Diamonds has been in the luxury diamond business for 10
years, creating personal relationships with our clients and producing

only the highest quality colored diamonds and jewelry. Backed by

leading diamond industry pioneers and trading companies we are

able to offer our clients the rarest of the rarest diamonds. Exclusive

off-market deals at attractive prices.