One morning last week, Will Hurwitz of Colonial Diamond Brokers in Frederick negotiated the sale of a $40,000 investment-grade diamond, sight unseen, over the telephone.

Hurwitz will get a 10 percent commission on the sale and the buyer will get a small, high-quality, certified diamond in the mail.

That type of transaction is being repeated with more and more regularity around the country these days.

Ice is hot.

But the ancient and glamorous diamond trade is a relatie newcomer to the investment world.

It is only within the past five years that U.S. investors, seeking a haven from inflation, have turned to the diamond market, which historically has provided a consistently high return on investment.

Of the approximately $3 billion spent on dimaonds in 1978, an estimated 20 percent went ot purchase investment-grade diamonds.

Becuase one concern, DeBeers Consolidated Mines, dominates the source of supply by controlling 80 to 85 percent of the rough (uncut) diamond market, diamonds have escaped the wild price fluctuations that rescently hit the precious-metals market.

But investment counselors and even jewelers caution that diamonds are not an investment for everyone. It takes a lot of money to get in the market and once in, it may take a long time to get out. And you may have to take someone else's word about what your buying.

Because of the intricacies of the pricing system and the variety of diamonds available, it is hard to get everyone to agree on how quickly diamonds appreciate. For instance, investment adviser Robert S. Salomon Jr. estimates that diamonds appreciated 25 percent in the past year, in contrast to a jeweler's estimate that prices rose 40 percent.

According to Hurwitz, a flawless, one arat, D graed diamond bought in 1969 for $1.600 would ommmand about $55,000 on to day's market.Grade D diamonds, clear in color, are the highest quality.Lower quality diamonds of grades E, F etc. appreciate more slowly.

"You're paying a premium to buy the diamond, because you're probably buying at retail when you're going to have to sell at a wholesale price," said Les Silverstone of Dean Witter Reynolds Inc. "In order for the individual to make money, the market has to move up substantially."

During the life of a diamond, it may change hands six or seven times, according to Karen Burman of Natioanl Jeweler, a trade publication for the jewelry industry.

"There are so many middlemen in the diamond business," she said. The markup at many of those stages may range from 5 to 30 percent.

"I'd be very cautious about going into that kind of a market," said Silverstone. "Obviously there are some professionals investing large amounts of money. They know what they're doing."

There are several independent gem laboratories that will certify the quality of a diamond. The two best known are the Gemological Institute of America and the European Gemological Laboratoires.

"The grading of diamonds is somewhat subjective but we do the best we can with trained personnel," said Steven Kendall, a gemologist with GIA, the oldest U.S. laboratory.

Although diamonds are considered an exotic, speculative investment in the United States, several industry observers noted that in Europe diamonds are considered a conservative investment.

Hurwitz, who started as a diamond broker 2 1/2 years ago, advises his customers not to purchase diamonds under 1/2 carat because "there is no liquid market for diamonds less than 1/2 carat."

He will not consider an order unless a client has at least $5,000 to spend. The average investment is in the $10,000 range, Hurwitz said.

Some institutional investors such as pension funds have turned to diamonds as an investment.

"People with less money can't afford to tie up their investment for a long time," he said. "We generally recommend that people buy a selection so that if they want to sell they can sell part of it."

The price of rough diamonds is set by the all-powerful DeBeers. "Once they are cut, they are priced in accordance with the current price on 47th Street (New York's diamond district)," said Jacques Voorhees of Polygon Corp., a company which is trying to introduce computer technology to the industry. "That market tends to be fairly definite. When you get outside the club price level, all hell breaks loose."

Diamond pricing begins with "sites" held several times a year. There sales dealers who have been invited by DeBeers may or may not pay prices set by DeBeers for boxes of uncut diamonds selected by DeBeers. But a dealer who says no has virtually no place else to go. It may take generations to get on the invitation list.

Polygon is trying to rationalize diamond pricing by providing individual dealers with up-to-the-minute information about bid and asking prices and a computerized market.

The system may meet resistance. The dealers "feel entitled to the markups and the privacy of the transactions," said Burman. "They're not looking at it from the point of view of the investor." The Polygon system "demands a lot of disclosure that old timers will resist," Burman added.