Fraser, who has caught the eye with his exciting and entertaining performances this season, rejected a new contract at Aberdeen and now hopes for a move, probably south of the border.
Manager Craig Brown and a long list of former Aberdeen players and pundits have advised the 18-year-old to remain at Pittodrie and develop his game over the next two or three years.
However, Diamond – who is now captain of Burton Albion in the npower League Two after a year at Oldham Athletic – doubts if his former club could repeat the kind of success they had under Jimmy Calderwood, who led them to the last 32 of the Europa League.
As a result, he considers Fraser's decision to look elsewhere, which as attracted criticism from supporters, entirely understandable. "I know the fans are talking about Fraser turning his back on the prospect of playing in European football if Aberdeen finish second or third in the league," Diamond said. "But he could stay and the team could go out in the first round.
"It's crazy that if a player like Ryan wants to better himself by moving on the fans suddenly see him as disloyal. Niall McGinn is doing well for Aberdeen but when the time comes that he wants to leave he'll be the next one to get it in the neck. That's the mentality of some of the supporters."
Diamond, for his part, believes he stayed in the Granite City too long and wished he had moved to English football years earlier. The 27-year-old, who became engaged to Nadine Hardie, sister of Greenock Morton midfielder Martin, on Christmas day, is enjoying life down south.
He previously stayed on at Aberdeen out of loyalty to then manager Calderwood and his assistant Jimmy Nicholl, signing a new two-year deal only for the "two Jimmies" to be sacked a short time afterwards and leave him, in his own words, "stuck at Pittodrie".
Diamond added: "When Chris Clark was about to leave Aberdeen for Plymouth the fans were booing him and my dad told me I would get that treatment when it came my time to leave. I didn't believe him but he was right. I was booed."