Seeking Alpha From Diamonds For My Investment Portfolio & Fund

With all competing investment products, from Hedge Funds to Equity Funds, Fund of Funds, Bond funds and Equity funds, which manager is not looking for that edge? for that Alpha…to outperform other funds to attract new capital…to show that extra percent return per year, to make a difference!

What managers need to see and realise is how diamonds, Fancy Color Diamonds specifically, can yield that extra return, without attributing a large portion of capital & assets, and without increasing risk. In fact, diamond investments is exactly the opposite, it is a real asset that over time will actually be non correlated to the general market and will reduce risk. It acts like a hedge.

In most cases the fund manager will not need to get approval from investors. Every fund has a small portion that can be used with discretion by the fund manager. It is this portion, if invested in Fancy Color Diamonds and managed properly can yield that extra Alpha.

Bond Fund with a twist

Take a bond fund for example. we know that once the 80% of the fund is invested in various bond products, and the remaining 20% can be invested in equity. Why not invest that 20% or even 10% in Fancy Color Diamonds? i will bet that if acquired (by hiring a co-manager for that portion) and sold properly, the gain made by diamond trading can give the overall fund performance an extra edge since the bond fund will always be compared to a bond benchmark. Even conservative investors will be happy generating extra alpha without increasing risk.

Non Correlated Asset

If we look at the price fluctuation of various Fancy Color Diamonds during and since the 2008 Financial crisis, we will find that since then, Fancy Color Diamonds have, generally, substantially, outperformed all other investment vehicles, including hard assets like gold, oil, and platinum, as well as other global indices and major corporations.

 

FCD1

Performance of Fancy Color Diamonds and Major Indices Dow Jones and S&P 500      Data Credit: FCRF

FCD

Performance of Fancy Color Diamonds and Major Indices Dow Jones and S&P 500      Data Credit: FCRF

FVP1

Performance of Fancy Vivid Pink Diamonds and Major Indices Dow Jones and S&P 500      Data Credit: FCRF

FVP

Performance of Fancy Vivid Pink Diamonds and Major Indices Dow Jones and S&P 500      Data Credit: FCRF

FVB1

Performance of Fancy Vivid Blue Diamonds and Major Indices Dow Jones and S&P 500      Data Credit: FCRF

FVB

Performance of Fancy Vivid Blue Diamonds and Major Indices Dow Jones and S&P 500      Data Credit: FCRF

FVY1

Performance of Fancy Vivid Yellow Diamonds and Major Indices Dow Jones and S&P 500      Data Credit: FCRF

FVY

Performance of Fancy Vivid Yellow Diamonds and Major Indices Dow Jones and S&P 500      Data Credit: FCRF

The Above tables and Graphs show the overall performance of various specific Fancy Color Diamonds and sizes against major indices S&P 500 and Dow Jones. We can see how Yellow Diamonds followed the market yet still remain above it. Pink and Blue diamonds o the other hand has seen a surge in value since 2008.

What do you think?

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