| Diamonds are not only a girl's best friend, they | | | | - Consider buying individual diamonds, getting them |
| can also produce a rock solid return. De Beers, | | | | set, and then selling them on eBay or your own |
| which controls 60% of the world's diamond | | | | website OR if you are good at setting up |
| production, has increased it's prices five times in | | | | websites then do a deal with a diamond merchant |
| the last 24 months, but worldwide demand is still | | | | where you sell diamond jewellery on your website |
| rising at 8% a year. In China alone diamond sales | | | | that you don't even own...buying from him or her |
| are expanding at 25% a year. Nor is this growth | | | | only when you make a sale. |
| limited to diamonds for jewellery. The vast | | | | - Don't buy so-called 'blood diamonds'. These have |
| majority of diamonds - some 80% - are used for | | | | been mined in Sierra Leone by workers kept in |
| industrial purposes and, here again, prices have | | | | unimaginably bad conditions and then smuggled out |
| been rising as demand outstrips supply. | | | | of the country. Not only is it unethical to buy such |
| The lure of diamonds as an alternative investment | | | | a diamond but in the long term it will be worth |
| is easy to understand. Over the long term they | | | | less. Ask for something called a Kimberley |
| have always more than held their value; they are | | | | Process Certificate - a sort of diamond passport |
| easy to transport and - for those living in politically | | | | that proves it has been mined ethically and legally. |
| unstable regions of the world - to hide; plus in | | | | - Watch for anything called 'clarity enhanced'. This |
| countries with heavy death duties, they can be | | | | means that the diamond has been artificially |
| passed down from generation to generation | | | | enhanced. Bad news. Also, don't buy diamonds |
| without attracting the attention of the tax man. | | | | over the internet unless you know the dealer |
| Unlike almost any other investment you can take | | | | personally. |
| pleasure from wearing them. Also they are | | | | - If you believe diamond prices are likely to |
| relatively liquid: there are dealers willing to buy and | | | | continue rising then consider buying shares in |
| sell diamonds for cash in every major city. Finally, | | | | diamond producers such as Firestone Diamonds, |
| if you know what you are doing, it is possible to | | | | River, Petra and Brazilian Diamonds. |
| make well above average profits. | | | | - Subscribe to something called The Rapaport |
| However, before you rush out and sink your | | | | Diamond Report ( an up to the minute price guide. |
| savings into sparklers a few words of warning: no | | | | Once you understand how diamonds are priced |
| one has ever made serious money from | | | | you may be shocked to discover just how much |
| diamonds buying jewellery or loose stones at | | | | mark-up jewellers make! Buying diamonds for |
| retail prices. Instead, you need to follow these | | | | investment you should expect to pay about 5% - |
| golden rules: | | | | 10% above the prices quoted in Rapaport. Bear in |
| - The better the quality of a diamond, the greater | | | | mind that if you buy your diamond in the EU it will |
| the chance you have of profit and the easier it | | | | be subject to VAT. If you buy it outside the EU |
| will be to sell. Demand for small, less good | | | | and bring it home VAT will still be payable unless |
| diamonds will fluctuate according to the economy. | | | | you smuggle it - which you mustn't do as this |
| - Learn all about the 4C's - which is how diamonds | | | | would be breaking the law! |
| are valued: | | | | - Consider coloured or 'fancy' diamonds. These are |
| Cut. This refers to the symmetry and proportions | | | | pure diamonds that - by an accident of nature - |
| of the stone. The best cut stones reflect light in | | | | have turned out pink, blue, green, amber or even |
| such a way as to optimise the fire and brilliance of | | | | red. They are much, much rarer than clear |
| the diamond. Diamonds are usually cut with 58 | | | | diamonds and - as such - command a much |
| facets and a Well Cut diamond will be classified as | | | | higher price. The market for coloured diamonds |
| Ideal, Excellent, and Very Good. Don't touch any | | | | has been growing as consumers begin to |
| other type. | | | | understand their scarcity value. Twenty years ago |
| Colour. The best colour (unless you are buying | | | | they cost less than clear diamonds. Now the best |
| coloured diamonds, of course, see below) is no | | | | examples are the most expensive gemstones in |
| colour at all! Diamonds are catagorised from D to | | | | the world. |
| Z with D representing the finest, colourless | | | | - Research something called Tanzanite. It isn't a |
| stones. | | | | precious stone, nor does it count as semi-precious. |
| Clarity. Almost all diamonds incorporate tiny - quite | | | | Discovered in 1967 in the foothills of Mount |
| natural - internal marks known as inclusions. They | | | | Kilimanjaro the best stones are vivid violetish blue. |
| may also have external marks called blemishes. | | | | Costing considerably less than diamonds the price |
| The less inclusions or blemishes the better the | | | | is volatile but Tiffany's the jewellers use it a great |
| clarity. At the top end of the scale are flawless | | | | deal and it could take off in the future much in |
| diamonds and there are over a dozen other | | | | the way coloured diamonds have over the last |
| classifications. | | | | two decades. |
| Carat weight. The larger the diamond, the more it | | | | One other possibility is to invest in a managed |
| weighs. Weight is measured in carats. The word | | | | fund that includes diamonds and diamond mining |
| carat originated from a tree called Ceratonia siliqua | | | | shares in its portfolio. Examples would include |
| which produces seeds of a consistent uniformity. | | | | Merryl Lynch Gold and General, Merryl Lynch |
| These seeds were used in olden times to | | | | World Mining and J P Morgan Natural Resources - |
| measure the weight of diamonds. One carat | | | | the latter has shown 50.6% growth in the year |
| equalled one seed! Now one carat is deemed to | | | | ending February 2006. |
| weigh 0.2 grams. | | | | If you like the idea of making money from |
| - You should only buy diamonds that have been | | | | diamonds then there is no doubt the best |
| certified by one of the recognised grading | | | | strategy is to buy very high quality stones and |
| laboratories. The best known of these are the | | | | don't sell until one of the periodic bull markets |
| GIA (Gemological Institute of America) and the | | | | when prices can rise in leaps and bounds. This |
| EGL (European Gem Laboratory). Your diamond | | | | may, however, involve a bit of a wait. Thank |
| dealer should show you the appropriate certificate | | | | heavens diamonds are forever. |
| and you should satisfy yourself that it is genuine. | | | | |