As a result of the recent crisis in global financial markets, investors are searching for alternative assets. Rather than being solely focused on ways to maximize their capital gains, they are all seeking tried-and-true strategies for preserving wealth. Many of them have chosen to invest in natural colored diamonds.

NUWire Investor states that a capital preservation strategy is the path that responsible investors should choose at this time. The website points out that there has never been a better time to consider investing in rare colored diamonds.

Diamonds, particularly Fancy Color diamonds, have an extremely high value despite their diminutive size and weight. A two-carat intense fancy yellow diamond is worth approximately $25K, and weighs less than 1/70 of an ounce. If the need arises, millions of dollars worth of diamonds can be concealed and transported on one's person. Diamonds were traditionally used as a medium to discreetly transport wealth across troubled borders.

The keen investor will note that natural colored diamonds have a solid history of steady price appreciation. Just recently, the Wittelsbach blue diamond went for $24.3 million at Christie's in London, setting a record price for any diamond or jewel sold at auction. In December 2008, Sotheby's New York sold an oval-shaped, vivid yellow diamond weighing 36.99 carats, for $71,870 per carat.

Demand for Fancy Color diamonds has skyrocketed in recent years. NUWire Investor states that this phenomenon is partially due to consumer awareness regarding the natural rarity of colored diamonds - out of 10,000 carats of diamonds mined only one carat will turn out fancy colored. The rarest Fancy Color diamonds are red, blue, green orange and pink. The supply of colored diamonds is declining while demand is increasing, clearly a great opportunity for investors as prices continue to climb.