Why blue diamonds are more expensive than yellow ones…

This past week Sothebys put up a fancy vivid yellow diamond, weighing a whooping 133 CT, for auction - after a bidding war the hammer fell at $5.5 million, making the price per carat ~$41 000.

In November Christies sold the Bleu Royal diamond for close to $44 million. Now the Bleu Royal “only” weighs 17.6 CT, meaning that the bidder who won paid $2.5 million per carat.

They are both top quality stones, so why is one so much more expensive? Especially given that larger diamonds are rarer, and price is anything but linearly correlated to size, all else equal shouldn’t a 133 CT stone be much rarer than a 17 CT stone?

Well yes, under most normal circumstances it would be a lot more expensive, but this is where color comes into play. In the world of Fancy colored diamonds red, green, purple and orange are the most rare. Then we have the blue and pink ones. Yellow and Brown are the most common, and that by quite a bit.

Actually less than 1% of mined diamonds are blue, and even fewer have that intense color: Fancy vivid blue diamonds weighing more than 10 carats are exceptionally rare. Since Christie’s was founded in 1766, only three such stones have appeared for sale — all in the last 13 years.

So, the answer is actually quite simple: rarity!

Yellow diamonds the size of an egg are rare - but blue ones the size of a medium pebble even more so!