You may have heard of the 4 C’s of diamonds—carat, color, clarity, and cut. The 4Cs are just one tool for diamond grading, which the GIA’s International Diamond Grading System has standardized in the diamond industry. Grading is a way to describe diamonds. Why is it important to know this? Diamond customers should know what they are buying and feel confident about their purchases.
Understanding the 4 C’s of diamonds is crucial for any diamond buyer and in this post, we’ll provide a guide for diamond elements and explain how they can affect diamond quality and the overall price of a diamond.
What You Will Learn
How BriteCo uses diamond variables
BriteCo offers a free, web-based appraisal system for jewelers. One of the most powerful features of the system is that it automatically calculates a suggested value for a piece of jewelry or watch, based on current data.
When it comes to diamonds, we use over half a million data points to build our price models. They get updated regularly to keep our values current with what’s happening in the market. Our models help us understand how various factors, including the 4Cs, affect the value of a diamond.
This Importance of Diamond Variables graph compares the variables against each other to show you how they rank when it comes to assessing price.
What does this graph tell us? The higher the percentage in the graph, which represents variable importance, the more price fluctuation you’ll see at the ends of the spectrum. Since weight (carat), color, and cut are the highest, you’ll see the biggest fluctuations in diamond price as those variables change.
In this post, we’ll break down each of the 4Cs to show you how it affects the quality and price of a diamond.
4Cs Dominate Price
Carat
We’ve all heard of carat, but do you know what that means? A carat (or ct), in the simplest of terms, is the weight of a stone. Gem quality diamonds all receive a carat grading; one diamond carat equals 0.200 grams or 1/5th of a gram.
As the carat weight increases, the price increases at a higher rate. Why? Because diamond prices are exponential rather than linear.
To illustrate what we mean, let’s examine the cost of a G/H color VS2/SI1 round brilliant diamond across the spectrum of weights.
Compares the total cost of a diamond in each weight category compared to the cost of a 1ct stone of similar shape, color, and clarity; e.g., a 2.0ct diamond costs 2.01 times as much as a 1.0ct stone.
As you can see in the Average Cost vs. 1 Carat Weight graph, as you move above 1.0 carat, the cost increases at a higher rate. This accelerating growth accounts for the rarity of larger natural diamonds relative to smaller diamonds.
For example, suppose you’re comparing a 1.0ct diamond to a 2.0ct diamond. In that case, the larger diamond doesn’t cost twice as much but instead 3.4 times as much. In the other direction, if you compare a 0.5ct diamond to a 1.0ct diamond, the smaller stone doesn’t cost half as much; it only costs a quarter as much as the larger stone. The higher the diamond carat weight, the more rare, and therefore, the more valuable.
Shopping Tips:
- For the price-sensitive shopper:The best bargains will be just below the cutoff points of the above categories. The stone will be negligibly smaller, but you’ll save a significant amount of money in price per carat. Another way to save money and not sacrifice carat weight is to look at lab-grown diamonds.
- For the quality-focused shopper: As you increase carat weight, the appearance in size does not grow at the same rate. In other words, a 2.0-carat diamond will not have twice the diameter of a 1.0-carat diamond. As you increase carat weight (and therefore value), the size increases in three dimensions, so the visible increase will be smaller than you might expect.
Clarity
Diamond clarity is the next most prominent price-impacting variable. Clarity refers to imperfections that occur in natural diamonds. Diamonds form under intense heat and pressure. During this process, a diamond can develop birthmarks and irregularities, known as inclusions. Clarity grading is done subjectively under 10x magnification and counts the number of inclusions, size, severity, and appearance. The grading ranges from flawless (no inclusions) to I3 (highly included).
Diamonds that are VS2 or SI1 are what’s called “eye clean.” This means the diamond appears not to have inclusions when seen with the naked eye but is only visible under 10x magnification. Let’s compare prices across the clarity spectrum against VS2 (“eye clean”) quality to understand better how clarity affects pricing.
Comparing the price of a ___ clarity diamond to a VS2 clarity diamond of the same weight, shape, and color.
Just like with color, the Clarity: Price vs. VS2 graph shows smaller relative surcharges for higher-quality stones and steep discounts for lower-quality diamonds. The discount is especially pronounced moving from SI2 to I1 stones, as this is where inclusions begin to impact the overall appearance of the diamond to the naked eye.
Shopping Tips:
- For the price-sensitive shopper: An SI1 or SI2 stone can fetch a nice discount without impacting the stone’s overall appearance. Here’s an important pro tip: two diamonds may have the same clarity grade but look different, even to the naked eye. This is one of the reasons working with a local, trusted jeweler is extremely valuable. A jeweler can evaluate the inclusions and make a judgment call on appearance to ensure you have a beautiful stone at the right price.
- For the quality-focused shopper: Moving into the VS1 or VVS2 range, which has very high diamond quality, doesn’t cost much more. However, you’ll see steeper price jumps as you enter the IF or VVS1 range.
Color
A stone’s color is the second most crucial diamond variable for influencing price after carat weight. Diamond color ranges from D (colorless) to Z (very light). (There’s a whole universe of color extending beyond Z, but we’ll save that for another day.) The color scale is gradual, and it’s hard to notice differences between two adjacent colors. In general, we like to think of color in groups. D to F is “colorless,” G to J is “near colorless,” and K to M is “faint.”
Comparing the price of a ___ color diamond to an H color diamond of the same weight, shape, and clarity
Let’s explore the price change compared to a widely selected color, H. Take a look at the Color: Price vs. H graph. Depending on which way you move from H, you’ll see a wide variance in the pricing. As you move to the left towards a truly colorless diamond (D), the diamond will get more expensive with each step. Moving to the right from H, as you approach diamonds with more color, you’ll get steeper discounts the farther down you go. However, once you reach very light-colored diamonds, the discount tapers off.
- For the price-sensitive shopper: An I or J color grade can net you significant discounts while keeping you in the near colorless category. If you have a yellow gold setting, you can venture farther into the slightly yellow territory for even more savings without sacrificing appearance.
- For the quality-focused shopper: Spending the money to get to F is worth it if you’d like to say you have a “colorless” stone.
Suggested Read:
What Is the Most Expensive Diamond Color?
Cut
After discussing the color, clarity, and carat, we can explore a diamond’s cut. A diamond is cut from a rough diamond by a professional and to take on its final shape. When you think of the diamond cut, this means the overall diamond shape.
A diamond can be cut into an endless number of shapes. Only ten diamond shapes dominate the market. The most common shape is round brilliant, especially prized by engagement ring customers for its beauty and refraction of light. In other words, the round brilliant diamond cut contains sparkle and brilliance because the diamond’s facets interact and reflect more light. If a diamond is not round brilliant, it is called a fancy shape diamond. The most popular fancy shapes are oval and pear shaped stones. Demand for fancy shapes will likely shift over time.
Comparing the price of a ___ shaped stone to a pear-shaped diamond of the same weight, color, and clarity.
In this graph, we compare prices to the pear shape, which is the standard bearer of fancy-shaped diamonds. In the Shape: Price vs. Pear graph, we can see a significant surcharge for round diamonds. Asscher and cushion-cut stones are significantly cheaper than the other fancy shapes.
Shopping Tips:
- For the price-sensitive shopper: Outside of round, pear, oval, and marquise diamonds, there are savings for other fancy shapes or diamond cuts.
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For the quality-focused shopper: Round and oval diamonds are the most expensive but classic and timeless. Diamond cut can truly make a difference in an engagement ring and can look different when worn, so try things on first!
Conclusion
As you can see, when selecting a diamond or diamond jewelry, there are many factors that affect quality and price. The 4Cs – carat, color, clarity, and cut – are going to make the biggest impact on appearance and value. And guess what? There’s more. Cut quality, fluorescence, grading lab, polish, symmetry, and conflict free diamonds (conflict diamonds are heavily regulated now and should not be a concern to the average consumer when purchasing from jewelers) are all important factors as well. Our post Beyond the 4Cs explains these additional variables.
Visit BriteCo’s free personal engagement ring calculator for a customized report based on your ring preferences. As always, protect your investment and get a free, no-obligation insurance quote today.
Related Articles:
What You Need to Know About the Portrait Cut Diamond
What to Know About the Hexagon Cut Diamond
Is An Old European Cut Diamond Best For My Engagement Ring?
Unveiling the Brilliance of the Trilliant Cut Diamond
What Is a Chalcedony Stone?
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