There have been a few high-profile diamond auctions this year, including a 2013 sale by Tiffany & Adelson, which sold for $6.2 billion.
The auctioned gems sold for a combined $3.8 billion, according to Bloomberg, and were purchased by Chinese billionaire Wang Jianlin.
But diamonds are expensive, and auctions have a lot of factors to consider.
“If you were to look at an auction for the next year, you would say there is no such thing as a ‘silver bullet’ for selling diamonds,” says Jeff Leventhal, an analyst at IHS Global Insight.
“But, of course, that’s true in many other industries where there are high-tech and highly educated buyers.”
For instance, diamonds could be the most expensive commodity on the market in 2019, but it’s the market that matters most.
“Diamonds are extremely scarce, and it’s not uncommon for them to fetch a few thousand dollars a tonne, whereas silver is typically around $30 to $50 a ton.
And even platinum is a few hundred dollars a year,” says John Danko, senior analyst at investment research firm Morgan Stanley.
Diamonds are one of the most precious metals in the world, with an average of around 4,000 grams of diamonds a ton in the United States.
Diamond prices tend to be determined by the price of the underlying metal, but that metal is not always the only factor.
“The price of a diamond can be a very important factor for determining the price at which a buyer will buy a diamond,” says Mark Schofield, managing director of investment banking at BMO Capital Markets.
“It’s why many auctions are not as well publicized.
Diamond auctions can be the first step toward the sale of a piece of jewelry, but they are often less well known, with some people not aware of their potential market value.”
And, of all the potential buyers, the buyer most likely to take the diamond for its true worth is the jeweler.
“A diamond is a very special object, and you don’t want to be the one selling it,” says Dankos.
“And if you are, you’re not necessarily going to be able to sell it.
So the best course of action is to look for someone who is able to really do the job.
And in this case, I think they did.”
Related stories Diamonds and jewelry are both worth a lot to some people, but are they the right choice?
The buyer, according the auction house, is not the one who will decide the value of a gem.
“I would say that it’s almost always a question of what the seller is willing to pay for it.
You’re not going to buy a gold ring for $3 million,” says Leventhall.
“In fact, the seller probably isn’t willing to do it for the money.”
A lot of people look at the price as a gauge of how much of a good deal a buyer might be willing to accept.
“There’s a perception that the buyer will be willing, if it’s within the price range, to pay, or the seller will be reluctant,” says David G. Hsieh, professor of finance at Cornell University.
“People will go to the site and look at a lot more details and be a little more cautious.”
Some of the key factors in the sale are how much the gem is worth and whether the buyer is willing or able to pay.
The buyer must be able “to sell the diamonds for a fair market value,” Leventh says.
“Some people have trouble accepting a $50 million price for a gem that has been in the family for thousands of years.”
For example, some people might not be able or willing to sell a gem at the same price as other jewelry, he adds.
“That’s not necessarily the case with diamonds.
If you’re willing to buy $50,000 for $1 million, it’s still a good buy.
If the price is $10 million, then that’s a good sale.”
Some people may not even be willing or ready to sell the gem at all, says Levehal.
“Most people won’t be willing even to touch the gem, because the value is so low.”
And when the seller does decide to sell, it can be expensive.
“For example, if the gem were $200 million and the buyer were willing to fork out $250 million for it, that could be a lot for a buyer,” says Hsiey.
“We’re talking about a lot less money than what’s paid for the entire jewelry industry.”
That’s not the only reason people might think the price should be kept low.
“You might be thinking, ‘Oh, I don’t have enough money to pay the seller for the gem and I don’ t have a good relationship with the buyer,'” says Leverett. “So,