Case Study 1: Mr. & Mrs. White Invest in a Vivid Yellow Diamond
Mr. & Mrs. White have been married for 20 years, have two teenage children and routinely invest in stocks and real estate. These investments have underperformed for the past five years. Frustrated, they decided to expand their portfolio by investing in hard assets and purchased a color diamond.
Purchase: 1.75 Natural Vivid Yellow Oval IF Diamond
Price Paid: $74,500
Appraised Value: $124,000
At year 2 the diamond was re-appraised at $145,000
At year 3 the diamond was re-appraised at $174,000
This is a 20% increase per year. *
The Whites held onto their diamond for three years and are thrilled with the increased value they have seen with independent appraisals so far. They are confident going forward that by holding onto their diamond they can potentially yield an investment of $315,135 from this one diamond purchase. This is a gain of $240,635 (less inflation over the next 17 years). The Whites envision using this diamond towards their retirement and/or passing it down to their children as part of their estate planning.
Year Price Increase Per Year
*Results not typical. This is a vivid diamond. Fancy and Intense diamonds may not appreciate as quickly as this example.
Case Study 2: Saving for the Twins’ Education
Mr. & Mrs. Dickson were having twins and they wanted to put away money for their children’s education, but they didn’t want to invest in a traditional RESP. They were convinced two investment-grade color diamonds would represent their children better. They did their research in terms of the type of rewards they could expect over an 18-year period.
Because they discussed this idea leading up to the birth of their twins, Mr. Dickson had a matching pair of 1.30-carat intense yellow cushion cut diamonds from Guildhall Diamonds made into a pair of beautiful earrings. His wife could then enjoy the diamonds while they appreciated in value. He presented them to his wife as a push present.
Mrs. Dickson intends on wearing the diamonds for special occasions knowing that when the twins are 18 years old she and her husband will present the GIA Grading Reports, Independent Appraisals and diamonds to their children to use for their education.
The Dickson’s expect a return on their color diamond investment of about $150,000 less their costs, which include taxes paid the first year, inflation over the 18 year period and the small re-sale fee when they are ready to sell their diamonds.
Investment: $72,000 plus HST
Potential Gains: $280,000
Year Price Increase Per Year
Note: While this is a conservative estimate it is a looking-forward statement.Disclaimer: This projection is based on the opinions and expertise of Guildhall Diamonds Inc. pertaining to the color diamond market. The above projection is not and shall not be deemed to contain or represent any warranty, representations, valuations, or guarantee respecting the item(s) herein described. Please see disclaimers on the last page for more information.