So you are heavily into mutual funds, stocks and property. You have even invested in gold exchange traded funds  recently to add variety to your portfolio. And you are still scouting for newer avenues to park your surplus funds. Well, you could invest in diamonds. Here are a few reasons why you should do so.

Diamonds are one of the most concentrated forms of storing wealth. Also they do not require any ongoing management like gold. Since they are insulated from the daily fluctuations of the markets, there aren't any sharp price changes. Add to this, demand for collectible diamonds, which far exceeds the supply and you have an ideal investment vehicle.

Most importantly, diamonds are only the precious gems which have a clearly defined internationally recognised evaluation process allowing independent verification of the quality. Basically, there are three institutes which give this certification. The Gemological Institute of America, International Gemological Institute and the American Gemological Society. Every diamond purchase of 0.75 carat or larger has to be accompanied by, at least, one of these certificates.  Factors that determine the value of the diamond include:

Colour: GIA grades diamonds on different scales. The rarest grade that is colourless (D-E-F) and nearly colourless (G-H-I-J) represent the accepted range for maximum appreciation. There are other grades which are faint yellow (K-L-M), very light yellow (N-O-P-Q-R), and light or fancy yellow (S-T-U-V-W-X-Y-Z). The last is the lowest in terms of quality.

Cut: Though there is no single measurement of a diamond that defines its cut, it is a collection of measurements and observations that determine the relationship between its dimensions and finish.

Shape: The shape is determined by the proportions, angles, polish and symmetry. Historically, the round brilliant shaped is recognised for its potential to appreciate. Some of the other popular shapes are heart, oval and pear.

Clarity Grade: Diamonds that are absolutely clear are the most sought-after and also the most expensive. But many diamonds have 'inclusions' like scratches or trace minerals that can reduce its value. Grades such as 'VVS, VS and SI' are differentiated, based on the amount of inclusions.

Carat: Carat weight starts from  0.01 carat and goes up to 5 carats.

In India, the diamond purchasing experience has not always been pleasant for consumers since it is difficult for a layman to determine the quality or purity.  Also, since most diamonds are bought in jewellery form, one may find their valuation a tedious and uncertain process.

However, in recent times, there have been new inclusions for those interested in investing in diamonds. Called 'Ezeediamonds', this initiative retails certified loose polished diamonds directly to consumers. These diamonds will be sealed in tamper-proof boxes and certified by the International Gemological Institute.

Customers can select from various sizes ranging from 0.05 carat to 1 carat. The diamonds would be categorised into three qualities VVS, VS and SI and be offered in DEF & GHI colours.

Ezeediamonds will also publish a price-list in which will be updated every fortnight. The pricing methodology is authorised by KPMG. Customers can trade in the product after a period of six months and up to two years from the date of purchase at the prevailing price in the chart.

It is likely that in due course of time there will be other players who enter into this unique retailing segment. This will help potential investors to tap this market.

The writer is a certified financial planner.