Global diamond prices have surged by an average of 30 percent in the first half of this year, much higher than the average price increase rate of gold at six percent, setting a ten year record high. Such prominent performance of the precious stone has attracted many consumers and investors to make bulk purchases in China.

When you come to the shopping centers in Beijing, you find a lot of customers are gathering at the diamond counters.

"I prefer this half carat diamond. It is about 20 to 30 thousand yuan."

"I've decided to buy a one carat diamond priced at 120 thousand yuan."

None of these diamonds were part of a ring or necklace - they are solely for investment purposes. Spurred by the demand from emerging markets like China, India and Brazil, diamond prices have shot up by 33 percent globally within the first six months of this year.

During recent years, domestic diamond consumption mainly focused on diamonds sized at 0.5, 0.75 and one carat. Those diamonds have soared in price - by 35 percent this year. However, the large stones that are bigger than 3 carats have seen a price surge of 150 percent.

Such high profit returns have lured many investors into purchasing large carat diamonds. An anonymous buyer says he is purposely trying to predict the market.

"I've recently spent 12 million yuan buying some colored diamonds and some smaller ones mainly aiming for investment."

The frenzy of investments in the market has driven many companies in diamond trade to stock the valuable stones, waiting for the peak moment to gain highest profit. The market at the same time, has also attracted some companies from other industries. As an example, one of China's largest internet companies, Tencent, has invested around 10 million US dollars in the diamond industry recently.

Manager Wu Xiaoguang from Tencent explains why such an IT company would also jump into this particular market.

"We've owned some stock shares of Kelan Company, one of the diamond companies in China. We also want to use our open platform to help develop business in this area and help them to achieve more in the future."

However, even though China has become the second largest diamond consumer in the world, the country has no influence on the original diamond price setting globally. Wang Yong says the three major diamond producers like the De Beers Group together with the major wholesalers normally set the global prices.

"They are controlling 85 to 90 percent of the raw diamond stones. Plus, China has only one out of the 120 global diamond wholesalers in the market, which means China has weak position in deciding on the prices."

That's why it's almost impossible for domestic diamond sellers to affect global diamond prices. As a result, Chinese diamond sellers have found great risks in making speculative investment on diamonds. If the whole market faces challenges, individual customers face huge threats. Plus, market insiders remind investors that it's not easy to sell diamonds for cash in the domestic market due to an immature trading environment compared to the western countries.