Pink diamonds sparkle for super-rich

LONDON (REUTERS) - This is the world's most expensive diamond.

This vivid pink stone, called the Pink Star, fetched a record US$71.2 million (S$99.5 million) at auction in April.

It was hailed as a one-of-a-kind, but other rare-coloured diamonds are attracting interest as well.

Those in the industry say they're soaring in value.

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"They are priced so high because they are so rare, we find so few of them per year," said 77 Diamonds managing director Tobias Kormind. "So we don't know what's coming next. You know, we may get surprised but the likelihood of finding any kind of significant quantity anywhere is so remote."

Diamonds can come in a variety of shades, including yellow and blue.

But it's the softer, romantic colour that seems to have caught investors' attention the most.

 
 

"Pinks have returned about 300 per cent over the last 10 years, while blues performed about 200 per cent, and the reason for that is, I think, there's just greater demand. Even though there's a larger supply, there's greater demand for the pinks than they are for the blues," said Mr Kormind.

And with concerns that deposits at the main pink diamond mine in western Australia are running low, prices could rise higher still.

According to the Fancy Color Research Foundation, vivid pinks have shown an average annual increase of more than 14 per cent since 2005.

That's making them a popular alternative investment - and a sought after fashion accessory for the super-rich.