From MoneyWeek · · 2m
Diamonds Lose Lustre: Worth Buying?
Diamonds' price drop and lab-grown rise challenge their value as investment and romance symbol.
In brief
Diamonds' price drop and lab-grown rise challenge their value as investment and romance symbol. Diamonds have lost 50% value in five years, with lab-grown options now dominating the market. Originally reported by MoneyWeek.
Diamonds' Romantic Symbolism
Diamonds became a symbol of romance after World War II, driven by increased affluence and De Beers' marketing.
The 'Diamond is Forever' Campaign
In 1947, De Beers' copywriter Frances Gerety coined the phrase 'a diamond is forever', hailed as the greatest advertising slogan of the 20th century.
“A diamond is forever”
Diamonds in Popular Culture
Diamonds appeared in films, songs, and literature, with Marilyn Monroe singing 'diamonds are a girl's best friend' in 1953.
“Diamonds are a girl's best friend”
Engagement Ring Shifts
By the 1980s, diamonds required two months' salary for engagement rings, up from 10% of rings containing diamonds pre-WWII.
Price Drop in Five Years
Natural diamonds' prices dropped more than 50% over five years, from $8,007 per carat in 2021 to $3,898 last month.
Diamond Standard Index
The Diamond Standard index hit an all-time low of $2,490 in August, now at $2,460, driven by lab-grown diamonds.
Lab-Grown Diamonds Rise
Lab-grown diamonds are 60%-85% cheaper than natural ones, with 61% of US engagement rings now lab-grown by 2025.
Lab-Grown Benefits
Lab-grown diamonds offer more options in size, cut, style, and price, with consumers buying 1.9 carats on average.
Ethical Concerns
40% of US couples said lab-grown diamonds were important for ethical reasons, avoiding blood diamonds and supply chain issues.
Supply Chain Challenges
Natural diamonds face declining supply, with major mines closing and De Beers slashing production by 12% in 2025.
De Beers' Market Share
De Beers' market share dropped from 90% to 25%, losing $7 billion in value since 2023 with a $787 million loss in 2025.
Investment Challenges
Diamonds lack liquidity and transparent pricing, making them poor investments compared to gold for inflation hedging.
Collector Appeal
Rare diamonds like the Motswedi diamond or azure blue 32-carat stones appeal to collectors but are not reliable investments.
What Happens Next
Diamonds may remain romantic symbols but are increasingly seen as poor investments due to price drops and lab-grown competition.
Here's the gist
Diamonds have lost 50% value in five years, with lab-grown options now dominating the market.
