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How To Buy A Loose Diamond - Our 4 Step Guide

How To Buy A Loose Diamond - Our 4 Step Guide

There are many different approaches people take when buying an item of jewellery. The game plan will depend on the type of occasion – is it for a massive life event such as popping the question? Or is it for a surprise, for an anniversary perhaps?

Maybe there’s no particular reason except that you’ve seen a piece of jewellery which you love and you just want to put it together with that person whom you love? Possibly you are buying the piece for yourself? Are you purchasing an important diamond ring for your engagement and you are carefully going through the process patiently together with your loved one? Some people buy jewellery partly, or wholly as an investment.

Because top quality pieces should hold their value at least - if looked after properly - and many items of jewellery should in fact increase in value over time, if kept in tip-top condition. Diamonds themselves are a popular investment. This is an age old tradition, a bit like investing in gold bullion. It is seen by many people as old-school, safe, blue-chip investing.

As opposed to many stocks, shares and other monetary investments - diamonds or bars of gold are real things which you can touch, hold and treasure. It’s more like investing in property and real estate – three dimensional objects which should at the very least hold their value, but most likely go up in value. Although this is not always true with real estate; things out of your control can happen, such as other developments in the suburb which can lower surrounding homes’ values. Or of course, a house can burn down or by eaten by termites! Well, these kind of terrible calamities can generally not occur with diamonds, which are amongst the most indestructible objects in the world.

As we’ve seen in previous blogs, rare diamonds such as pink diamonds from Australia’s Argyle mine, have increased in value over time more than most other valuable items on the planet. So, maybe investing in diamonds is in fact an idea worth discovering more about? In which case, you would most likely be looking at purchasing ‘loose diamonds’. But, you may also be considering buying a loose diamond or two for other reasons. So, we are going have a closer look at this subject. Diamond Exchange presents How to Buy a Loose Diamond. Our 4 step Guide.


OK, a loose diamond is not a radiant rock which is wobbling around a bit on its setting. If you have one of these, you need to take it off, put it safely in a small box and get it pronto to your jeweller to be fixed! A loose diamond is not a sparkling specimen which has broken loose from the herd and has made run for it. Nor is it a shining stone which has questionable sanity or morals. A loose diamond is a gem-quality diamond which has not been set in a diamond engagement ring, pendant, diamond earrings or bracelet or any form of diamond jewellery. In general, a loose diamond will look just like that image you have in your head and see in advertising of a gorgeous stand-alone diamond. It has been cut and polished by experts – quite often into the classic ‘round’ shape but also into varying typical shapes, such as emerald, princess, heart shape and others. When diamonds are mined and they come to the surface, they are rough, dirty, dark - have no particular shape and have jagged edges. Diamond cutters transform these ‘diamonds in the rough’ into brilliant stuff, and they are then sent around the globe – on offer to various wholesalers, diamond houses and jewellers. They are ready to be fixed to precious metal settings and become wonderful items of jewellery, which is where many will end up. But, many remain loose and are not difficult to buy, if you are in the market for one.


There are a few reasons. Firstly, you might be a very wealthy and/or famous eccentric who likes to carry around loose diamonds in their pocket as a highly valuable and special form of currency. Yes, there have been a few such types in history, but we don’t recommend it. Not practical, safe or wise.

Secondly, you might want to invest in diamonds, to hold on to for posterity, trusting that your gleaming investment will increase in value over time, and who knows, maybe one day a loose diamond could be converted into a stunning item of jewellery at the right time. Or become a fabulous family heirloom. In the meantime, you get to see the diamonds, touch them, play with them. This could be an especially enjoyable past-time if you are a serious diamond lover and aficionado! And some investments in loose diamonds have proven to be incredibly successful. For instance, if you bought some high quality, beautiful Argyle pink diamonds a number of years ago, chances are your investment has gone up by at least 500%, and you haven’t had to do an ounce of maintenance, pay any council rates or deal with any pesky tenants, so that is very good going. Investing in loose diamonds is definitely an option worth considering, if making more specialised investments sound like it’s up your alley.

However, we think it’s probably more likely that you would be looking at potentially purchasing a loose diamond (or two) because, thirdly – it can allow you some additional time, options, versatility – and it may prove to be economically advantageous to you.

For instance, you may have a precious metal setting which is say, a family heirloom, which you wish to use to make a special engagement ring, but you need a loose diamond in order to complete the package. Or, you may have unique specifications and find the exact diamond you want is available, but only as a loose stone. You can buy it and then have it fitted into a custom setting. Perhaps in your travels you run into a loose diamond which you ascertain is a bargain, and you decide to buy it to potentially convert to an item of jewellery later. You may be able to purchase a loose diamond at a wholesale price through your jeweller, saving you quite a few dollars. It is worth discussing with them! Perhaps you and your partner find it exciting and interesting to look around at loose diamonds, with a view to purchasing one you both love and building it into a spectacular diamond engagement ring down the track.


1. Firstly, decide whether you are strictly investing or buying a loose diamond with a view to turning it into a unique diamond engagement ring, wedding ring or other piece of glittering jewellery. You could always change your mind, but if it’s purely for investment - initially - you will need to make slightly different arrangements in terms of storage, insurance etc. Your jeweller can help you with advice in these matters.

2. Decide where you are going to buy it, or at least narrow it down, otherwise you could be shopping around all over the place and getting mighty confused. In big cities there are diamond dealers, who are often in premises near each other, and it is possible to ‘shop around’ from one to the other. However, this could be very time consuming, and could also be confusing, if you are receiving conflicting advice from dealers. If you have a jeweller with whom you already have an existing relationship, it might be more straightforward and give you better peace of mind, to stick with someone you trust and have dealt with before. Also, it has become more and more common, in recent years, to compare all jewellery - including loose diamonds – online. Most businesses have massively improved their on-line offering, so that you can get a really good look at the stone and its accompanying paperwork, via new hi-fidelity technology. So you can ‘comparison-shop’ from home.

3. Do your homework. Learn as much as you can about the main elements involved – including the way in which different diamonds are valued, diamond sizes and the different ways in which diamonds are used when they are made into items of jewellery such as diamond engagement rings. At Diamond Exchange, we have carefully and extensively outlined all the information you may need when buying a diamond, including a loose one. Make use of the resource! The main things you will need to consider are known as the Four C’s. These are Cut, Colour, Clarity and Carat. It’s also important to make sure the diamond has the appropriate, official certification. All reputable jewellers should be able to provide this without any difficulty.

4. Buy the loose diamond! You’ve decided why you wish to purchase a loose gemstone. You’ve done your homework and decided where you are going to look for one – as mentioned – your trusted jeweller will give you the right advice and price. You’ve narrowed it down to a few similar diamonds perhaps? Or have you fallen in love with one lucky loose diamond, and just know in your heart and mind that you’re meant for each other? Have a good, close look. Once you are sure, go for it – you are now the owner of a fantastic and unique loose diamond, wow! You can take the next steps at your own pace now. Perhaps that’s the best aspect of going down this path…

There are other potential advantages of buying a loose diamond. For example, you (and your partner, if you’re doing this as a team) can get to see the overall diamond in all its glory – in its total, true form. This is not completely possible when the gemstone is already in a setting. You can really handle it from all angles, play with it – get to know it better than you can with a diamond which is already perched in a precious metal setting. Some people really like this idea of being able to get more intimate from the get-go.

It is often possible to get a diamond which has higher gradings in all the Four C’s – for a better price, if you go for a loose diamond. It does mean you will need to take the extra steps of then choosing or designing a setting and waiting for it to be made. But all good things take time, right? Talk to us today at Diamond Exchange about purchasing a loose diamond, if you think this might be for you.

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