How Much Does a Diamond Cost?
How much does a diamond cost? That’s the million-dollar question, and if the rock is big and beautiful enough, a million dollars may be the answer as well. However, not all diamonds go for six figures, some go for quite a bit more, and others for quite a bit less.
A diamond’s cost depends on its quality. No two diamonds are exactly alike, and each one has to be evaluated according to its own individual features.
In the 1940s, the founder of GIA put a universal method into place for determining the quality of a diamond, called the 4C’s. The term, “4C’s,” is a mnemonic device used to remember the four characteristics of a faceted diamond. Those are carat, color, clarity, and cut. A diamond is graded by its performance level in these three categories. When all are factored together, the price of a diamond can be determined.
However, at about the same time the GIA was putting the four C’s into action, there came another factor, which affected the price of a diamond, and that was how it was created. When the process of producing synthetic diamonds in a lab was first introduced to the mass market, it meant a significant drop in the market value of a diamond. Diamonds could be manufactured easily, and as a result, could be sold for competitive prices. There was, now, a fifth consideration to take into account.
Lab-created diamonds are still subject to the 4C’s, but they have a little edge over the competition. Since they are created in a controlled environment, gemologists can tweak the process to make sure that all diamonds get top grades in the 4C’s. That means you could get a higher quality diamond for a much lower price. To fully explain this, we need a little background.
In this article, we will discuss:
- Why a Natural Diamond Is So Expensive
- Lab-Created Diamonds
- Carat Size of a Diamond
- Color of a Diamond
- Clarity of a Diamond
- Cut of a Diamond
- Side by Side Comparison: Natural Vs. Lab-Created Diamond: Which is the Better Value?
Why a Natural Diamond Is So Expensive
When the natural diamond surfaces on this earth, it makes a dramatic entrance. The growth of a diamond requires rare and extreme conditions that only occur in limited zones of the earth’s mantle. These occur least ninety miles below the earth and at temperatures exceeding 2000 degrees Celsius.
The volcanic eruptions that deliver diamonds to the surface are also rare. So rare, that they have never been witnessed by a human being. Besides the rarity of the conditions needed for diamond formation, diamonds also take time to form. The average diamond takes millions of years to crystallize. Is the cost of natural diamonds worth the wait? Until lab-created diamonds came along, they apparently were. Traditionally, consumers have forked over fortunes for the rare jewels, not only because of their beauty but their rarity as well.
It didn’t take a genius to see that there was a profit to be made by improving and accelerating this process. In fact, many people tried and failed, but it did take a genius to come up with the means to do so. In 1904, French Chemist, Augustus Verneil, discovered a method to produce synthetic gemstones using a high-pressure, high-temperature method that paved the way for lab creation as we know it.
Lab diamonds are real diamonds in every sense of the term, they are optically, physically, and chemically identical to natural diamonds, the only thing that separates one from the other is their origin. The lab-created diamond is created by means of a closely monitored process in a lab whereas the natural diamond is produced geologically. In the case of the lab-grown diamond, the same crystallization process takes place, with only several millions miles above the earth’s mantle where the conditions are not left to chance. As a result, higher quality diamonds can be produced.
When a diamond is produced in a lab, real diamond seeds are used to begin the growth process. When the diamond is placed and growth conditions are established, nature takes over. Therefore, lab-created diamonds are identical to natural diamonds physically, optically, and chemically. In addition, unlike natural diamonds, lab-created diamonds are not finite resources, and the greater supply keeps consumer costs down.
Carat Size of a Diamond
Besides possessing identical chemical and physical properties, another thing that is common to both lab-created and natural diamonds is that they are both weighed in carats. The more the diamond weighs in carats, the more it will cost.
We pay more for bigger carat size not only because of the greater quantity of product, but also the greater rarity. Therefore, diamond carat price rises exponentially rather than linearly.
In layman’s terms, that means two, one-carat diamonds will not add up to the cost of a two-carat diamond, all other things being equal. The best way to find the price of a diamond is by multiplying its cost per carat by its carat weight.
Some of the math has been done for us. According to a current diamond pricing guideline, a 0.5-carat natural diamond will cost about $1,500, a 1-carat will cost anywhere from $4,500 to $6,000, and a 2-carat can range for $1,800 – $21,000.
While the price of a lab-created diamond is also determined exponentially according to carat size, its price is exponentially smaller than a that of a natural diamond. The efficiency of making a lab created diamond can result in price differences ranging from an average of 30%-40%. That holds quite a bit of weight when it comes to pricing diamonds by carat.
While diamond price increases with carat size, it isn’t the only thing weighing in on the price of a diamond. The other three C’s factor in as well. One diamond may have a bigger carat weight than another, but poor clarity, cut, and color can easily trump size when it comes to a price.
Color of a Diamond
If black is the absence of color, white is all colors. We call something white when all colors are reflected from an object to bounce back and hit our eyes. The beauty of a diamond depends upon its ability to reflect light, therefore white diamonds are the most valuable and most highly desired.
The GIA Color Grading Scale rates diamonds on their absence of color. Many diamonds take on a yellowish tint while they form. Sometimes this coloration can be so slight, it is difficult to spot this with the naked eye. The GIA determines color grade of the stone by comparing it to other stones under ideal viewing conditions. Once the diamond is examined, it is graded. That grade determines the effect it will have on your bottom line when it comes to your purchase.
The GIA Color Grading Scale works by rating diamonds on a scale from D-Z. The letters D-F represent the colorless category. These diamonds are rarely found in nature and are of the highest price. As the alphabet moves up, the amount of color in the diamond goes up, and the price of the diamond goes down. S to Z ratings indicate a light-yellow tone. These stones are the least desirable and are usually not available on the commercial market due to lack of demand.
In the case of lab-created stones, highly prized, colorless diamonds can be created inexpensively. The controlled lab environment permits the growth of colorless Type IIa diamonds by creating ideal conditions for diamond growth above ground. Thus, lab-created diamonds of higher color ratings can be found at comparable prices, and diamonds of similar color ratings can found at lower prices.
Clarity of A Diamond
If the color of a diamond refers to the lack of diamond color, the clarity of a diamond refers to its lack of imperfections. When diamonds form under intense high pressure, high-temperature conditions, they don’t always emerge without a scratch. In diamond talk, these scratches are called inclusions and blemishes. Inclusions are internal imperfections, and blemishes are external imperfections.
While most inclusions are not visible to the naked eye, they affect the way light is transmitted and scattered throughout the stone. Even if the imperfections themselves are not easy to spot, they will have an impact on the overall appearance of the diamond.
The GIA Clarity Grade is assigned based on the appearance under ten times (10x) magnification. The number, color, size, orientation, position, and visibility of the imperfections are all taken into consideration when it comes to determining the clarity grade of a diamond.
Like us, no diamond is completely without flaws, however, the ones that come the closest get the highest grades and are priced accordingly. If a diamond exhibits no inclusions visible to an expert using 10x magnification, it falls into the esteemed Flawless (FL) category and can fetch a pretty penny for its rarity and beauty.
The more humble diamonds are assigned lower gradings by the GIA, the lower the prices are by the vendor. Most diamonds on the market fall into the Very Slightly (VS) or SI (slightly included) categories. When inclusions are obvious under 10x magnification, it can affect the diamond’s brilliance and transparency. These fall into the Included (I) category and are considered to be of considerably less worth than more highly graded diamonds.
As the lab-created diamond grows in a controlled environment, flaws are less likely to form. Flawless, lab-created diamonds can go for 30% to 40% less than flawless natural diamonds because there is a steady supply.
Cut of a Diamond
If the 4C’s of a diamond were a deck of cards, the cut would be the Ace. A good cut in a diamond can override clarity and cut in the overall appearance of the diamond.
The reason cut is so important is because it is responsible for the one quality we look for most in a diamond, its ability to sparkle. Artistry is required to make a stone that delivers the maximum light return possible to achieve the dazzling optical effect.
The GIA Cut Scale rates diamonds on the quality of the cut of stone on a five-point scale: excellent, very good, good, fair, or poor. The grades are based on the proportions of facets that influence the appearance of the diamond. These proportions are used to evaluate the most desirable optical effects of the diamond-primarily, brightness, fire, and scintillation.
Brightness is the white light reflected from the stone, fire refers to the scattering of the white light that creates the rainbow colors, and scintillation is the amount of sparkle the diamond gives off.
A diamond that receives an, “Excellent,” rating will display an even pattern of dark and light areas This is the ideal proportion for maximum fire brilliance and scintillation. As the balance starts to slide and more dark areas appear, the diamond will exhibit less brightness and scintillation, which will bring its cut grade down. Whether lab-created or natural, the cut of a diamond will always have an effect on the diamond’s price.
Side by Side Comparison: Natural Vs. Lab-Created Diamond: Which is the Better Value?
In order to give you a, “more show and less tell,” idea of how much buying a lab-created diamond can save you, we’ve done a little side by side comparison.
For our first diamond, we have chosen a one-carat diamond. Its color grade is, E. Its cut is ideal and its clarity grade is VS1.
Our second diamond is a 1.13-carat diamond. One would assume it would be higher in price for its carat weight alone. All other things are the same. Its color grade is E, its cut is ideal, and its clarity grade is VS1 as well.
If both diamonds were natural, the second diamond would indeed be higher in price, but because one of these diamonds is lab-created, that is not the case. The first is a Blue Nile natural diamond, and its cost is $7,259. The second is a Brilliant Earth lab created diamond. Its cost is $4,300.
How much does a diamond cost? After reading this article, we still don’t have an exact answer, but if we’ve learned one thing, it’s how to shop intelligently for a diamond. By understanding how the 4C’s work and knowing how much money a lab-created diamond can save you, you can make intelligent decisions about which diamond you choose to buy.
So, what do you think? After seeing the numbers, would you buy a lab-created diamond or would you stick to the natural choice?