There’s no doubt about it: diamonds are HIGHLY valuable! They range in prices from several hundred dollars up to literally millions (the Pink Star diamond sold for $83.2 million at auction). But do you know what makes some diamonds worth more than others? Sure, the size of the diamond is one of the factors that play a role in its price, but there are a number of other factors to consider.
So how much is a diamond worth? How do experts figure out the value of a diamond? Can anyone calculate the worth of a diamond, or is there some secret formula used by gemologists? Below, we answer all your questions about diamonds and their value, including the 4 C’s (cut, color, clarity, and carat) of diamond valuations, the ways to figure out diamond prices, and more. By the end of this page, you’ll know everything you need to in order to know what your diamonds are worth!
How Are Diamond Prices Calculated?
Whether you’re looking to buy or sell a diamond, it’s important to know its value. Being able to figure the rough value of a gemstone is the best way to avoid being ripped off by untrustworthy retailers or gemstone dealers. Plus, the knowledge will help you to negotiate the best possible price for the diamond.
How Much is a One Carat Diamond Worth?
The simplest way to calculate the price of a diamond is to take its weight (carat) and multiply it by the diamond price per carat. The “price per carat” is similar to the “price per troy ounce” that you’d use to calculate the value of gold jewelry. All you have to do is multiply the price per carat of the diamond by the carats in that diamond, and you have its value.
To find the price per diamond carat, you have two resources: IDEX (the International Diamond Exchange) and Rapaport. You can log onto these websites and get daily information on the price of diamonds. They even have an option to download the price list (it will cost you $50) for the week. With the price list, you’ll have an easier time calculating the value of your diamond.
However, there is something you need to know about these price lists. The lists give you the cash value for the diamonds, but that ONLY takes into account the carat and carat price. That doesn’t include the other 2 C’s of diamonds (color and clarity), or any of the other features (flaws, unique elements, etc.) that make a diamond more or less valuable.
If you base your valuations on the IDEX or Rapaport lists, you may end up overestimating the value of your diamond. You could be disappointed when a professional gemologist tells you it’s not worth as much as you believed. Or, even worse, you underestimate the value of the diamond, and you walk away with less money than the diamond was worth.
That is why we at Twery’s highly recommend a diamond appraisal, especially if you are considering selling a diamond. A professional appraiser will take into account ALL the factors that go into determining the price of a diamond, giving you the most accurate value of the stone.
Online Diamond Retail Listings: Another Option to Consider
If you’re trying to figure out the value of your diamond and haven’t yet taken it to an appraiser you can trust, you may want to consider using online diamond retail listing websites—like Blue Nile or White Flash. These websites give you detailed listings of stones and their values according to the 4 C’s (see below). The search engine allows you to search through the list of diamonds to find the ones that match yours closest, and get an accurate idea of their value. If you don’t want to go the route of a professional appraisal, these websites are a good resource to use.
The Main Characteristics to Consider When Determining A Diamond’s Value
When it comes to appraising a diamond, there are five factors that go into the process of determining the value. There are the 4 C’s—carat, color, cut, and clarity—as well as the diamond’s official certification. But why are these things important?
The carat, or weight, of the diamond is the “foundation” upon which the value of the diamond is built. The heavier the stone, the higher the carat. Given that diamonds are sold on a “price per carat” basis, this is the first element diamond retailers take into account. A 1 carat diamond is worth twice as much as a 0.50 carat diamond because of its weight.
Did you know that most diamonds have a slightly brown or pale yellow hue? Put them up to the light, and they’ll let off this yellow/brown color. This is due to the nitrogen content of the diamond.
The unusual coloring of diamonds makes them pricier. A colored diamond is worth more than your typical pale yellow/light brown diamond.
Colorless and clear diamonds are also rarer, and thus more highly prized. Fine jewelry retailers prefer to sell colorless and clear diamonds.
Color is ranked on a scale of D-Z. A diamond with an M-Z rating has noticeable color, and thus is the lowest-priced. A diamond with a ranking of H and under is rare, with very little color, and much pricier.
Cut is another word for “shape”, or the shape to which the diamond is cut. A great cut can bring out the brilliance, scintillation, and fire of even the roughest diamond.
However, in addition to the shape of the cut, there is also the grade of the cut. A high-grade cut means the cutting and polishing of the diamond is excellent. A low-grade cut means the stone is poorly cut and polished.
Cut Grades are usually only available for round diamonds. They include Poor, Fair, Good, Very Good, and Excellent or Ideal.
Clarity is judged according to two things:
- Inclusions, or internal flaws
- Blemishes, or external flaws
Both of these flaws can stop the diamond from reflecting light, which prevents the diamond from being as brilliant, fiery, and scintillating as it should be. Thus, a flaw lowers the value of a diamond.
There is a very high demand for diamonds with few or no flaws, so a higher clarity grade means a higher value for the stone.
Note: The lab that analyzes the diamond’s clarity will usually draw up a diagram of the stone’s flaws (location and type) to identify it as a unique stone.
Only very large inclusions will affect the stone’s structural integrity or performance. Cracks or flaws close to the surface increase the risk that the diamond will fracture.
The certification of a diamond is a document created by gemologists giving a detailed grading report after a thorough measurement, evaluation, and study of the diamond.
In the case of round diamonds, there will also be a Cut Grade included.
There are two major organizations in the U.S. that provide diamond certifications: the American Gem Society Laboratories (AGSL) and the Gemological Institute of America (GIA). These two are the most highly-respected in the industry due to their consistency and unbiased systems for grading diamonds. A diamond with gradings by these organizations are highly valued.
If you have a gemstone you are considering selling, it’s vital that you understand the various factors that go into defining the value of the gemstone. The 4 C’s mentioned above will help you to figure out the general price of the diamond so you won’t get ripped off when taking it to a jeweler to sell.
However, you need to remember that your understanding of diamonds’ value is fairly limited. All the information above won’t make you into a professional jeweler who can study a diamond and figure out its clarity, cut, color, and characteristics. In order to reduce the chance of someone taking advantage of your ignorance, it’s best to take it to a professional appraiser. It’s what we at Twerys recommend for anyone selling anything of value: gold and silver coins, diamonds, or other valuables.
What do you think of the information above? Is there anything more you’d like to know? Drop a comment below and share your thoughts. We’d love to hear from you and answer any questions you may have.