Diamonds are always popular, but despite their popularity, there is a lot an average customer doesn’t know about them. This gives jewelry stores a sense of freedom to charge you how they see fit. Learning more about diamond prices or some factors influence them is the best way to avoid getting ripped off or overpaying for jewelry.
How are diamonds priced?
Diamonds are priced per karat. The prices per karat increase with higher weight categories. This means that a cost of purchasing some diamond increases together with weight.
Besides categories and weight, the price of a diamond is also influenced by cutting. It is not uncommon for big diamond companies to manipulate the market and prices by taking rough diamonds with diameters that should have been used for 0.75ct-0.85ct. Then, they keep those diamonds over 0.96ct but sell them as 1ct diamonds.
Of course, they will have to sell these diamonds at a lower price than real 1ct diamond, but they still do make a profit off of something that’s just not right.
Diamond price chart
Regarding the prices, we can divide diamonds into two different categories: those who are priced off of the Rapaport diamond list and their counterparts who are not.
The Rapaport report is the jewelry industry standard for diamond pricing. The report is compiled and published on a weekly basis and distributed to diamond merchants and jewelers to determine the prices for customers.
The list is named after Martin Rapaport who founded Rapaport Group in 1976 and started with this report two years later, in 1978.
As you can see, the list features four separate grids, each representing a different size category. To find the price of some diamond you need to know size category, color, and clarity. Price is always listed in hundreds.
In many instances, diamonds trade at a discount to the Rapaport price. To determine the discount price, jewelers and diamond merchants take five factors into consideration:
- Inclusion quality
- Luster of the diamond material
- Color quality
20 back or 20 below
In the diamond jargon, 20 back or 20 below is a term that refers to the situation when a diamond with a beautiful cut and weaker fluorescence is sold for 15-20% less. To calculate the actual price of a diamond, it is necessary to reduce that percentage from the price in Rap List. Don’t feel bad if this seems too complicated, diamond prices aren’t actually based on logic and reason.
Now, if we also bear in mind that color, clarity, and many other factors influence the diamond price, the need for an expert opinion is intensified. It is crucial to have someone to help you in order to avoid getting ripped off.
Alternatives to Rap List
Although considered standard in diamond pricing, Rap List is not the only chart used for this purpose. Alternatives to this report include:
- IDEX – unlike Rap List, their pricing tool is easy to use and fully transparent. In fact, some major diamond dealers support IDEX, but unfortunately broader market still tries to resist
- Diamond retail benchmark – complicated just like Rap List, also features discounts that have to be applied in order to get the actual price
Despite wide popularity of diamonds, the pricing game is not fully transparent in most cases. Numerous factors determine the price of diamonds and it can be difficult to calculate the cost even with tools that are available. Those diamonds that don’t fall under Rap List require expert approach. Don’t underestimate the power of professional help when looking for diamonds, but don’t want to get ripped off. Consult an expert to learn more and get to the bottom of diamond pricing.