When you think about diamonds, the first thing that comes to your mind is their price tag. They can be extremely expensive. Some sellers rip you off by selling low-quality diamonds for hefty prices. While in other instances you pay more due to lack of understanding how diamond prices are determined. Keep reading to learn more about this important subject.
Factors that influence price
Diamond prices are influenced by multiple factors including:
- Carat weight – without a doubt, size of a carat has the biggest influence on the price of loose diamonds. This important factor also opens the door to manipulation because some jewelers can claim the diamond is one carat when it’s about 0.90 only. Consult an expert who can tell you the real carat weight of diamond
- Cut – the cut refers to how the angles and facets of a diamond work together in order to reflect light. Cut influences diamond’s well-known sparkle, beauty, and brightness. A poorly cut diamond appears dull, lifeless, and may even seem dirty. Generally, the better the cut the higher the price of the diamond
- Color – in the world of diamonds, color refers to how colorless or how white the diamond appears to be. Again, the better the color, the more expensive the diamond
- Clarity – this is a measure of how many imperfections are found in a diamond. Cleaner diamonds have a higher price than their counterparts
- Shape – yes, shape of a diamond also influences its price. Round cut diamonds are both the most popular and the most expensive than other shapes such as princess, oval, cushion, emerald, etc.
Diamond price chart
Diamond prices are everything but logical. While many factors play a role in cost of loose diamonds, the prices are a matter of decision rather than calculation. This decision is made by Martin Rapaport and his team who release the Rapaport list on a weekly basis. They have been releasing this list since 1978. The list is a baseline for pricing of diamonds. Diamond sellers use Rap List to adjust and set prices. See the example of one such list here.
The list classifies diamonds weighing between 0.01 to 5.99 carats and displays a price for any combination of the diamond characteristics. As the diamond passes through different hands the price increases even more, which explains why they are so expensive.
Nowadays there are some efforts to replace the Rapaport list because the creator has his own interests in the business, which is why prices benefit him primarily. One such alternative is IDEX with a simple, easy-to-understand diamond pricing tool and it is transparent about methodology. On the other hand, Rapaport list isn’t truly transparent. Nobody knows how the prices are exactly determined but Martin Rapaport and his team.
Discount and Premium Prices
The crucial part of understanding diamond prices is getting informed more about discounts based on the Rap List. Factors that determine the discount off of the Rap Price include:
- Luster of the diamond material
- Color quality
Diamonds aren’t cheap; they are more like an investment you make. That’s why you should be aware of the entire process. Since you are going to spend money on diamonds, then you have to know how prices work. Unfortunately, diamond pricing is tricky and not fully transparent. While you would expect logic to play a role here, the reality is different. Multiple factors influence diamond prices, which is why you can benefit from seeking expert help to understand this important process.