In the world of jewelry, no matter what the industry deems to be a fabulous example of a great stone, the market ultimately determines its value. When I was taking my GIA courses, I remember learning how the beauty and color of a stone ultimately depends on the buyer’s preference. While having industry-related benchmarks that determine a stone’s value is important, none of that matters if the buyer doesn’t perceive it the same way.
This became apparent on November 15, 2017, when “The Raj Pink” diamond failed to sell at Sotheby’s Geneva auction. This was the world’s largest known fancy intense pink diamond and it was expected to sell between $19.8 million and $29.8 million. The bidding stopped at $14 million, and the stone didn’t sell.
When I look at this ring, I see a very large, unique, and beautiful stone. However, one of the main reasons attributed for the sale’s failure is that the stone has a strong blue fluorescence. In other words, under an ultraviolet light, it gives off a glowing effect. This reduced the stone’s popularity with some buyers in the Chinese market.
Overall, there were some stones that broke records nonetheless. The Art of de Grisogono, a D-color, flawless rectangular cut stone weighing in at 163.41 carats, sold for $33.7 million (USD) at Christie’s auction in Geneva on November 14, 2017. The diamond, which can be worn in the form of necklace or bracelet, was estimated to sell between $30 million and $40 million. The sale price, even though record breaking, fell short of the higher end of the estimated range. Tobias Korwind, managing director of 77 Diamonds, stated, “It is a worrying sign for the top end of the diamond market suggesting it is not as immune as one would have hoped to downward price pressures caused by global factors such as the Chinese slowdown, Russian sanctions, and lower oil prices.”1
The sale of this diamond also came with some controversy related to the ownership of the stone. It was alleged to be owned by the Dos Santos family, and Isabelle Dos Santos, former president of Angola, is worth an estimated $3.5 billion. A social media site protested the sale a week prior to the auction and noted that the sale of the diamond should be used to build a children’s hospital in Angola.
The new owner of the Art of de Grisogono is an anonymous bidder who won the bid by phone. The designer did not comment on the origin of the stone nor the ownership but did say that the transaction was auditable and ethical.
I find it fascinating that at the end of the day the market can be so dynamic and that a buyer’s preference and the market itself can be affected by a myriad of factors including social, economic, and ethical reasons. No matter what the reason, the outcome of any of these sales is always unexpected and exciting and is another reason why I enjoy jewelry so much.
Juqui Monterroso, AJP, is an Associate Underwriter Manager with Chubb Personal Risk Services.