Being here on this page counts you in the growing number of smart shoppers out there. Since information is now at our fingertips, more people find it easier to know what they’re getting into and dodge getting ripped off!
Those who are too lazy or busy to know the real score automatically trust popular branding and cunning salespeople. But this read won’t take much of your time. And the insider tips you’ll learn will save you more time from scanning through thousands of diamonds on the market!
So without further ado, here’s a quick guide to verify and learn about diamond prices, as well as discover how to compromise the 4Cs to maximize your budget.
How Are Diamonds Priced?
Diamond prices aren’t as easy as 1+1=2. There are several factors that influence their exact value. The most vital ones are created by GIA to standardize diamond grading. We call them the 4Cs – Cut, Carat, Color, and Clarity. Now, to regulate diamond prices, Martin Rapaport invented a diamond price chart that is now widely known as…
The Rapaport Report Price List
“The List” was created in 1978, although Martin Rapaport had already been immersed in the diamond industry for many years. He was a cleaver and rough sorter in Antwerp, Belgium, before becoming a diamond broker in New York in 1975.
After the emancipation of the price chart, he had also established RapNet Diamond Index, an electronic trading network, as well as diamond news published online and in print. The Rap List is usually released every Friday and is basically used to standardize the pricing of individual diamonds from SI3 clarity and higher, and K color and beyond.
How to Read the Rapaport Price List
The chart on the left is for round diamonds from 0 to 5 carats. Each cube signifies a weight group. The letters on the left represent the color grading, while the top column indicates the clarity grading.
You may learn about your diamond’s price by picking your stone’s carat weight’s matrix, then cross-checking the row where your color grade is with the column where your clarity grade is.
The result is the diamond’s value in hundreds, so if you get 62, it means the diamond is worth $6,200 per carat.
That’s right, diamond prices are per carat! Looking at the chart, you’ll notice that the carat weight escalates together with diamond prices in each matrix. And if you know how to use it, you will definitely not overpay.
Saving Money with Pricing Per Carat
Here’s how this works: If a diamond is priced at $2,600 per carat, and it weighs 1.50ct, it will be $2,600 x 1.50 = $3,900. But more importantly, diamond prices also jump per weight category. So, it’s not evenly escalating per carat, diamond prices surge and sometimes double or triple when it reaches an in-demand number.
Take note of these popular carat points: 0.50, 0.75, 1.00, 1.50, 2.00, 3.00, 4.00, 5.00 and so forth. On the contrary, a heavier diamond doesn’t mean it’s bigger on the surface, and a stone less than 0.01 carat won’t really show any difference in size when seen with bare eyes.
For example, we have here a 0.98 carat, a 0.99 carat, and a 1-carat diamond:
Rarity is Expensive
Another factor that reaps favorability is scarcity. The rarer the diamond, the pricier it will be. Thus, if you have an E-colored diamond, it will be more expensive than an H color, not just because it’s a higher grade, but also because it’s rarer.
And the bigger the carat, the harder it is to find one with a great cut. A 2 carats and a 3 carats with the same specs will have a bigger price difference than a 1 carat and 2 carats. In short, the price per carat increases as the diamond gets bigger and rarer. You’ll be surprised to see two 1 carats priced way less than one 2 carats, but that’s just how supply and demand works!
Important Factors You Can’t See on the Price Chart
One thing you should bear in mind is that the Rap List is not enough. You may use it as a guideline, but you still need to check other factors to justify diamond prices:
The one on the right is eye clean, while the one on the left possesses dark inclusions. Both diamonds are 0.90 carat, G – SI1 with an Excellent Cut.
So you’ll see the two diamonds in the same value in the chart. However, the one on the right is priced higher because of its eye-cleanliness. A determinant that’s not in the Rapaport Chart and is something you need to scrutinize with real diamond photos.
2. Diamond Certificate
After knowing of the diamond price, it’s time to cement its value with a diamond certificate. Having this professional seal will assure you that you’re getting the real deal.
Diamonds aren’t cheap, so it’s a must to have your stone certified by the only reliable labs in the US – GIA and AGS. Don’t be swayed by a dealer’s guarantee. If there’s no certificate, there’s nothing to talk about! Period.
Also, there are other diamond labs out there, but I would only recommend GIA and AGS because they provide consistent grades. Unlike EGL, for example, that’s more lenient with their grading. Ergo, an SI2 diamond rated by GIA could be a VS2 with EGL. This will give you a diamond with a better clarity on paper but is actually a SI2 in reality.
Some diamond shops would even dis the GIA certificate of an I1 Clarity diamond so they could sell it for a higher clarity grade, and thus, a higher price. That said, always make sure that the diamond prices from the Rap List are backed by certificates from reputable labs to legitimize their worth.
3. Diamond Cut
Now, despite being the most important factor in the 4Cs, Diamond Cut isn’t part of the Rap List. The reason for this is that most cutters would prefer a bigger carat than a better cut, and diamond prices exponentially increase with carat weight.
For instance, if a cutter chose to sacrifice 0.01 carat to make an excellent cut 0.99-carat diamond instead of an average cut 1.00 carat, he’ll lose 20% of the supposed price.
Unfortunately, the largest diamond companies use this type of deceit to supply more popular carat points. They will spare a proportioned cut and great sparkle for a few more points to achieve the most in-demand weight categories.
Here’s a graph depicting how diamond prices tremendously rise for main carat points:
But you should understand that a diamond is best enjoyed for its brilliance and sparkle – and that is made possible by the diamond cut.
Additionally, diamonds in the 0.90 H VS1 category on the Rap List could also greatly differ in price depending on the cut.
The examples above show the same specs but one has a good cut, and the other has an excellent cut. The price jump is huge but, in this case, you don’t have to prove its worth because we should only go for the best when it comes to cut – as cut is king!
How to Determine the Discount and Premium Off of the Rapaport Diamond Prices
All of the above plus fluorescence, polish, and symmetry determine the discount and premium on the Rap List. Color, clarity, and weight create the baseline for standard pricing, but the other factors are subjective. There’s what we call “20 Back” or “20 Below”, and it goes like this:
Imagine you have an eye clean 1-carat SI2 diamond with a G color, Excellent Cut, and no fluorescence. Despite being SI2, all the other factors will increase the value of the diamond. In the Rap chart, a 1 carat G SI2 would be priced at $5,900, but with favorable determinants, it could trade at -20% or 20 back/20 below.
So to get the discounted price, we reduce 20% from the Rap price. This leads us to 20 back $5,900 per carat or $5,900 x (100%-20%) = $4,720!
Why Color and Clarity Remarkably Up the Price
By basing from just the Rap List itself, it’s pretty obvious that the components in gauging diamond prices are led by color and clarity. But the truth is, an eye clean H SI1 with an Excellent Cut will look better than an H VS2 with a so-so cut even if the latter has a better clarity and is more expensive.
There’s also a price jump for grades that are included in the sweet spot range. Just take a look at the diamond prices between a 1 carat G VS1 and a 1 carat F VS1, then compare the 1 carat G VS1 to a 1 carat H VS1. The latter comparison has a bigger price difference. In fact, $400 more!
Demand is basically built on emotions, and it’s still a mystery how people come up with these sweet spots. Nonetheless, you need to take advantage of it while it’s hot! And if you need a little boost, you can always ask a diamond expert to pinpoint the magical range of color and clarity for you.
Diamond Shape Has Impact, Too!
Although the round cut is the staple diamond shape for engagement rings, the new gen has also come to love other diamond shapes called “fancy shapes.” There’s always going to be classics, but edgy styles are resurfacing and thus, putting unpopular shapes into the spotlight.
Since the round cut is the godfather of diamond cuts, it is deemed as the most expensive. Aside from being traditional, it also exhibits the best brilliance, fire, and scintillation, upping its value even more.
If your girl is unconventional, eccentric, or simply into unique shapes, you’re in for a treat as most fancy shapes tend to look bigger than rounds. And did I mention they are way cheaper?
Take a look at how diamond shape impacts the price with these diamonds with the same 4Cs (1 Carat G-VS2 Excellent Cut) in different shapes:
By opting for other shapes, you can save 20%-40% and use that to find a bigger carat or the best cut possible. Just keep in mind that GIA doesn’t have a cut grade for fancy cut diamonds. So if you’re really eager on buying one, make sure you’re assisted by a legit jeweler, your choice has a diamond certificate, or you are viewing a website with real diamond photos. Better yet, check out my post on fancy shapes here!
Alternatives to the Rap List
IDEX Diamond Price Report
The Rapaport List may serve as today’s gold standard when it comes to diamond prices, but if you paid close attention, you’d see loopholes and inconsistencies. It’s also not difficult to be biased if the system is created by someone who has financial interests in diamonds. Many have tried to create alternatives to Martin Rapaport’s price chart, but ‘The List’ still reigns supreme.
The closest challenger would have to be IDEX Diamond Price Report. Like the Rap List, IDEX also publishes diamond-related content and offers a B2B industry diamond exchange. The cool thing about IDEX is that their price list methodology is explainable. They’re still in the process of attracting a wider market, but they already have the support of some major dealers.
Online Diamond Shops’ Search Tool
What I usually do is compare diamond prices through a diamond search tool. You can be more specific with your preference, plus there are diamond photos and videos to give you a better visual. Whiteflash, Brian Gavin, and Leibish have user-friendly diamond filters to help you know of base diamond prices. But I like using James Allen for their 360-degree diamond display technology.
As for their diamond search tool, by simply inputting the specs, you’ll be able to see the diamond prices right away. The example below shows diamonds sorted with these parameters: Round Cut, 1 Carat, G Color, VS2 Clarity, Excellent (Cut, Symmetry, and Polish), No Fluorescence, Graded by GIA/AGS
So if you were offered a diamond with the same specs for $10,000, you know you are getting ripped off! Same thing if you were quoted $3,000, the legitimacy of the diamond begs to be questioned. By learning the base cost in a few taps, you won’t have to worry about dubious diamond prices.
Now, to make sure you’re getting the right value, be more specific in your search. Use as many filters as possible and make fair comparisons. The 4Cs plus shape and advanced options can be tweaked to further achieve an “apples to apples” comparison.
Easiest Way to Get the Biggest Bang for Your Buck
Besides knowing of the right diamond prices, who wouldn’t want to spend less than their budget? With the following in mind, you can find a diamond with a much affordable price:
First off, stick with the sweet spot (G – VS2) as the higher grades won’t show much difference. You can even go for as low as an SI2 or a J Color if you like the yellow tint. Remember that fancy shapes are less expensive and the none-fluorescence level can be waived as it’s affecting the brilliance the least.
If you go with a diamond with faint to medium fluorescence, it could make the diamond appear whiter than it is. Best of all, it will trim the price by 5%-15%!
When it comes to ring settings, you can always opt for a classic solitaire and a 14K Gold to save money. Forget popular carat weights if you’re on a budget and settle with the ones just below the in-demand numbers.
Last but not the least, the only factor you shouldn’t compromise on is the diamond cut – this should stay at the top! If there’s a parameter we’d sacrifice diamond prices for, it will only be the cut.
I know that diamond specifics can be overwhelming at first, so when in doubt, use the Rap List or filter 4Cs at James Allen. Since diamond prices are conceived from various factors, it will take time delving into technicalities. But one thing’s for sure, numbers can be your friend if you know where to look.
Have questions? Comments? Suggestions? Write them below or email me!
My advice is free. 🙂