Unless one is in the diamond trade they are unlikely to see loose diamonds. In fact, very few people will see little bags of these stones unless they are watching a movie. But diamonds don't come naturally in rings, bracelets, and necklaces. Loose diamonds, or otherwise free, are how most jewellers buy their stones.

The intricacies of these kinds of diamonds can often be difficult to understand. Not only are these stone's prices based on the four C's but there are often many other factors that investors have to consider when looking at these kinds of diamonds. Loose stones are graded on cuts, sizes, and colours as well as several other factors.

The price index for these stones has risen steadily over the last few years indicating the rise in demand for such diamonds not only by the general public but by jewellers, collectors, and traders as well. High quality diamonds go for higher prices but the prices are not steady rates. The demand oscillates not only over the years but within the year as well. For someone looking to buy into the diamonds market, it would be prudent to do detailed research to find the best time for an investment to occur.

Investing in loose diamonds-or otherwise-is a big decision. So why should you take the risk? For starters, the risk is not that big and if you are looking to design your own jewellery piece investing in a loose stone is the way you want to go. You do not have to buy more than what you need so by investing in a loose stone, you will get exactly what you want.

But buying diamonds loose can be a tricky business. The markets for such stones are changing and the details used to price diamonds are varied and many. Unless properly skilled, many investors should seek expert advice to avoid a mistaken investment that looked good but became sour due to a minor detail like a flaw in the diamond. The wise investor should also be aware of the general trends in the market and that some of these changes are due to the shifting in demand and not in the quality of the stone. Also, local UK markets can be different than a local market elsewhere which is another factor an investor needs to be aware of.

• How much do you have to invest?
• How long do you want to invest for?
• When do you require a return on investment?

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