Diamond pricing is a complex function of a multitude of different factors. The complexity of diamond pricing arises out of the fact that no two diamonds are alike and as such it is difficult to compare the price of two different diamonds.
There are three main factors that affect the price of diamonds:
- Supply and demand levels
- Macro-economic factors such as GDP growth, levels of disposable income and currency exchange rates
- Gemological characteristics of the diamond
While the first two factors affect the overall price trends for diamonds it is the third factor that directly affects the price of a given diamond.
Diamond Characteristics and Diamond Prices
Although there are no specific formulae for calculating the price of a given diamond, customers should be aware of generally accepted rules of thumb based on the gemological characteristics which determine the price of a diamond.
Diamond Prices and the 4C's
As mentioned above, the four fundamental characteristics of a diamond are its Cut, Carat, Colour and Clarity. The most practical rule of thumb to use when understanding the price of diamond is that the larger the diamond and the better the colour and clarity the more expensive the diamond will be. This holds true across all the different shapes of diamonds.
As far as different shapes are concerned, the general rule is that round diamonds are the most expensive followed by square-shaped such as Princess, Emerald and Assher and then other fancy shapes.
How other diamond characteristics affect price
It is important to note that although the 4C's are the major gemological determinants of diamond prices, gemological characteristics do play a role. Some such examples include:
- Polish and Symmetry - diamonds that have a better polish and symmetry will generally be priced at a premium above similar diamonds with lower grades of polish and symmetry.
- Cut Grade - diamonds that have a better cut grade will generally be priced at a premium above similar diamonds with lower grades of cut grade.
- Fluorescence - the presence of fluorescence will generally cause a diamond to be priced at a discount below a similar diamond that does not possess fluorescence.
The abovementioned general rules of diamond prices should be used as a mere guideline for understanding why different diamonds have different prices. These rules of thumb are subject to changing market conditions, trends and consumer preferences.
If you have any queries about diamond prices it is advised you contact one of our diamond experts by using the form found on the Contact Us page.