Learn the Value of Your Diamond
Buying diamonds or selling diamonds can be a daunting task for many people! There are so many factors to consider when trying to determine the true value or a diamond. How do you know if the diamond you are about the purchase for thousands of dollars is worth the price tag? How do you know what makes a “good” diamond? How much is a diamond worth if you decide to sell it later? We want to answer your questions!
What Makes A Good Diamond?
There’s no cut and dry response for what is a “good” diamond and what is a “bad” diamond. A large part of it is personal taste. Some people prefer bigger diamonds whereas others think that those are tacky, and would prefer a smaller, more delicate version. So first and foremost, when buying a diamond for yourself or a loved one as a gift, choose the one that fits your personal preferences!
As for the resale value, this is determined by a set of standard factors: carat weight, clarity, color, and cut! These factors have been coined the “Four C’s” by the Gemological Institute of America, and are accepted all around the world. These are the attributes of diamonds that cause some diamonds to be considered more valuable, demanding a higher price tag.
The Four C’s
The carat weight of a diamond basically refers to its size. Because larger diamonds are rarer, a single one-carat diamond is worth significantly more than a cluster of .10-carat diamonds even though the total carat weight may be equal.
The clarity of a diamond refers to the presence (or absence) of flaws, which are called inclusions. A flawless or nearly flawless diamond is one that is very clear and has no visible dark spots. The clarity scale varies from Flawless to Included, and each category is further broken down to identify the exact clarity grade of the diamond.
(F) Flawless – These diamonds are extremely rare and very expensive! They have no surface flaws and no internal flaws even under strong magnification.
(IF) Internally Flawless – These diamonds are also very rare and expensive but can be much more affordable than an F diamond. They have surface flaws but no internal flaws.
(VVS1-VVS2) Very Very Slightly Included 1 and 2 – Under a 10x magnification by a gemologist, some very minor internal flaws and surface flaws can be found, but are very difficult to detect. Prices vary widely for VVS1 and VVS2 diamonds.
(VS1-VS2) Very Slightly Included 1 and 2 – These diamonds are similar to VVS2 diamonds, but the inclusions can be found somewhat more easily under a 10x magnification.
(SI1-SI2) Slightly Included 1 and 2 – Small flaws can be found somewhat easily under 10x magnification and can sometimes be seen with the naked eye.
(I1, I2, I3) Included 1, 2, and 3 – Surface and internal flaws can be viewed under magnification and with the naked eye. I3 diamonds are the most flawed, and it is not recommended to buy diamonds with these grades.
The clarity grade can dramatically affect the value of the diamond!
Diamond color is an important part of its valuation. Even though fancy colored diamonds exist (and are very valuable), white diamonds are what people typically think of when they imagine diamonds. The color grading refers to white diamonds. The absence of color in white diamonds leads to a higher price because colorless diamonds reflect light much better than tinted ones.
A color grade is given as a letter from D to Z:
(D-F) Colorless – Only an experienced gemologist can see differences among D, E, and F diamonds. They are very expensive compared to other grades (a D-diamond can be double the retail price of an I or J-diamond!)
(G-J) Near Colorless – These diamonds have a barely-noticeable yellow tint and can be set on white gold bands because the contrast between the color of the diamond will not be too strong against the band.
(K-M) Faint Color – The tint in these diamonds is detectable with the naked eye. K-grade diamonds can be HALF the price of a G diamond, and can be appealing when set on a gold band. Don’t ignore these!
(N-R) Very Light Color – Easily noticeable yellow or brown tint. Although they are less desirable, they can be a very affordable option for many consumers.
(S-Z) Light Color – These are typically considered to have too much color for most consumers. They are the most opaque and poorest receivers of light. Some diamond stores do not even carry diamonds of S-Z grade.
The cut of a diamond refers to two things. The first one is the shape. Common diamond cuts include round, oval, princess, cushion, asscher, emerald, marquis, pear, and heart. The shape that you buy should depend on personal preference. However, the value of a diamond (and its retail price) varies with the cut, as shapes drift in and out of style over the years.
In addition, the cut of a diamond refers to the proportions of the diamond, which affect its reflective properties. Ideal Cuts are those that maximize the brilliance of the diamond, and Poor Cuts reflect the least light but are typically cut this way on purpose to maximize the carat weight.
Remember, cut is not the same thing as shape. To learn more about diamond shapes, check out this guide.
The Bottom Line…
The bottom line is that there are many factors that come into play when you decide to buy a diamond, and all of them affect the retail price. Keep in mind that the retail price is the market value of the diamond plus a markup, and the markup varies by retailer. The most important thing you can do to avoid overspending on a diamond is to do your research and educate yourself as much as possible before making the big purchase.
If you have a question concerning a diamond in your possession, taking it to an experienced gemologist is one way to receive an evaluation of your stone. However, one gemologist’s opinion may not be completely accurate. The best way to get a full evaluation of your stone is to send it to a reputable lab for analysis. We recommend the Gemological Institute of America. They can look at your diamond and give you a Diamond Grading Report, which includes their evaluation of all the factors above and more! Having a GIA certification can be quite beneficial if you plan to sell a diamond, as it is the most widely-recognized diamond certification entity.
Ready to Sell a Diamond?
Maybe you are upgrading to a new diamond, or maybe you received a diamond ring as an inheritance. Whatever your story is, bring your diamond to one of Orlando Jewelry Buyers’ 3 locations and we will use the standards outlined above to give you a fair, honest evaluation of your diamond if you plan to sell it to us. We will then offer you a price based on the market value of that diamond. Insurance appraisals and original retail price have little to no effect on the value that will be placed on your diamond, so keep that in mind when you come! However, if you have an official certification (particularly from the Gemological Institute of America), we can use that information to determine our offer.