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07
December 2016

Diamond Price: What are the Influencing Factors?

There are many factors that can affect how much a consumer pays for a particular diamond. And while most people know about the 4Cs – Cut, Color, Clarity and Carat – these are not the only determinants of the diamond’s price tag in a retail jewelry store. Of course, the 4Cs are the most important factors, and can cause fluctuations of nearly 30 percent in the diamond price, but there are other things to consider as well.

Diamond Price: The Fluorescence Factor

Fluorescence is a diamond’s tendency to give off a soft, colored glow when put under ultraviolet light, such as black lighting. Fluorescence is actually considered to be a defect in a diamond because it can make the diamond look blurry and murky rather than clear and brilliant, subduing and obscuring the fire and scintillation caused by the diamond’s interaction with light. The price of a diamond that emits a strong fluorescence can often be valued 10 to 20 percent cheaper than those having a much fainter fluorescence, or none at all.

It’s All About Shape

Popular diamond shapes tend to change according to fashion trends, however, as a general rule, round brilliant diamonds of the same carat size are more expensive than other shapes, followed by cushion, princess, radiants and asscher cut stones. The lowest priced stones in terms of shape are emerald, oval, pear and marquis cut. Part of the reason for this divergence in price is the fact that round brilliants are the most commonly bought, driving the price higher. But it also has to do with the way the round shape shows off the diamond’s shine. Since round brilliant diamonds have the most facets, there are more opportunities for the diamond to interact with light. This makes the round brilliant shape shine more brightly. On the other hand, a larger cut, such as an emerald, has more flat surface space, thus dispersing the shine throughout, making the diamond appear duller, and removing one of the major factors that drives a diamond’s value.

All the Rest

Other factors that influence diamond price include color, and depth of color for fancy colored diamonds. Diamonds with deeper, purer color will be more expensive. Polish and Symmetry also have an effect on the amount a consumer will pay for their diamond choice. Polish refers to the smoothness of the surface of the diamond facets after cutting, while symmetry refers to the overall precision in the cutting of the shape. These are known as the stone’s finish, and they affect the overall look of the final polished diamond. The polish and symmetry of a stone can actually affect its value by 7 to 10 percent.

Treated stones, those that have been enhanced in a gem lab to detract noticeable flaws on the diamond surface, are also generally reduced in value. Enhanced stones are a better match for a buyer who wants the beautiful appearance at a cheaper price, and not for buyers looking to buy a high quality natural diamond as an investment or cross-generational heirloom.

Rarity also affects diamond price. Where did the diamond come from? Was it from a mine that does not produce many diamonds? Was it hard to obtain? Was it buried under the ocean and drilled using special equipment? All these factors have an effect on the stone’s value.

Even for seasoned experts, diamonds can be difficult to classify due to the numerous factors that cause fluctuations in price. With the development of precise, automated grading technologies, some aspects of assessing diamond price will become easier, and more standardized. Even with the use of technologies, the diamond appraiser must take into account all of the interlocking features of diamond, in the context of the current market situation and trends, in order to judge its true value.

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