Press Release: The Fancy Color Diamond Index, developed by The Fancy Color Research Foundation (The FCRF), was first launched in November 2014 to measure and analyze the performance of these rare diamonds as an alternative asset class. The January 2015 Index read shows that fancy color diamonds are continuing to exhibit consistent price levels, against a backdrop of commodity value declines in the fourth quarter of 2014.
Having launched in late 2014, the index is the first piece of fancy color diamond market analysis to provide this type of industry intelligence. It revealed that fancy color diamonds, across the categories of pinks, yellows and blues, have increased in value by 167 percent on average since January 2005, outperforming other leading assets in a similar period. The Dow Jones industrial Average, for example, has increased 58 percent, Standard & Poor’s 500 has increased 63 percent and London house prices have increased 82 percent.
According to the most recent index read in January 2015, fancy color diamonds remained practically unchanged in the period between October 1 and December 31, 2014. This performance is further testimony to the favorable supply-demand dynamics of fancy color diamonds.
This is especially remarkable when compared to the significant weakness in white diamond prices during the same period. According to the Rapaport Group's RapNet Diamond Index (RAPI™), 1-carat diamonds prices declined by 5 percent over the same period; 0.30 carat diamond prices declined by as much as 9.2 percent. At the same time, other commodities, including oil, iron ore and coal, also suffered steep price declines.
Within fancy color categories, 10-carat blue diamonds (fancy, intense and vivid) experienced the highest price increases (about 4 percent) of all categories.
During January 2015, the FCRF significantly expanded its global contributor reach for collecting pricing data for the index. For the first time, the data collection process became fully automated. Secure, online questionnaires were sent to a large, representative sample of leading fancy color diamond trading organizations, who provided detailed and granular market pricing inputs for all fancy color diamond categories included in the index. Furthermore, the collected information included, for the first time, pricing data for three new size categories: 1.50, 3 and 8 carats (across all colors).
Ishaia Gol, a member of the board of advisors for The FCRF, commented, “Unsurprisingly, the fourth-quarter data collected by the FCRF team reaffirms our knowledge and understanding from the last decade that fancy color diamonds are a separate niche, almost non-correlated to white diamonds.”
“Fancy color diamonds are rare and highly desirable. In periods of financial instability we have witnessed time and again that collectors, retailers and investors are able to maintain their assets’ value, even as other asset classes are depreciating in price. This is caused by the inherent lack of global inventory, which is only projected to worsen in coming years. Our data contributors are reporting a decline in the number of transactions, mainly as a result of political developments in China.”
Detailed index data and charts are available to members on the FCRF website and are one of the key benefits of membership of the foundation. Over the coming months, a number of additional publications that provide the jeweler retail trade with crucial fancy color diamond knowledge and information will be launched.
About the FCRF:
The FCRF is an independent, non-profit organization formed to promote fair trade, ethics and transparency in the fancy color diamond retail, wholesale and mining industry. The FCRF activity includes the development of innovative research and digital tools that will support the fancy color diamond retail selling process for consumers, retailers and collectors; the promotion of fair trade in fancy color diamonds throughout the value chain, underpinned by reliable data analysis to create a uniform knowledge base across all industry layers and the authoring of publications to clarify the complex methodology for evaluating fancy color diamonds.
Membership in the FCRF is open to retailers, auction houses, wholesale traders/manufacturers, financial institutions, insurance appraisers and mining companies. Organizations interested in membership of The FCRF should visit fcresearch.org to register or for more details.
About the Fancy Color Diamond Index:
The Index is a first-of-its-kind tracker of changes in the market prices of yellow, pink and blue fancy color diamonds, the three most commonly traded fancy color diamond categories (a market price is a wholesale transaction taking place in one or more of the global diamond trading centers).
The Index is a composite representation of changes in price points gathered since 2005, based on a statistically significant sample size. It offers insight into variations in the appreciation of diamonds of different colors and sizes.
The Fancy Color Research Foundation oversees proprietary prevalence and pricing data aggregation and production of the index. A third-party New York-based audit firm reviews the development of The Index from the various data points gathered.
Rapaport News is not responsible for, and does not endorse, the content of any third-party press release. This is not a Rapaport Press Release. It has been provided as additional information for our clients.
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