Diamonds are one of the most beautiful and durable gemstones in the world. Therefore, it is not difficult to understand when they are sought after by many people as jewelry.
Diamond jewelry is loved by the general public and enthusiasts because of its durability, rarity, and luxurious appearance. Currently, they are becoming more and more diverse and sophisticated to each carved line.
However, not everyone clearly understands the nature and classification of this gem in the jewelry world. Below, The Economic Times offers useful guidelines before choosing to spend money on expensive diamonds.
Factors that affect price
In fact, there are two main factors that determine the price of diamond jewelry: the diamond itself and the accompanying metal (most commonly gold). Before diving into the matter, one needs to distinguish between carat (CT) which is a measure of the weight of a diamond while karat (KT) is a measure of the purity of gold.
Usually, people can know the price of 24KT gold on search sites. However, we cannot do the same with diamonds.
Vipin Sharma, sales director of online jewelry store BlueStone, said there is actually no specific standard to quickly identify the price of diamonds.
In addition to the cost of finding and owning diamonds, processing and finishing them, such as cutting or polishing, also costs a fortune. Most importantly, supply and demand factors also affect the price of diamonds.
“Customers need to test diamonds with different jewelers to get an exact price per carat,” added Parag Shah, director of KISNA, the jewelry brand of Indian diamond exporter Hari Krishna. .
Pricing Formula
Jewelry made from diamonds is often inlaid or set on other precious metals such as gold or silver. Usually, 18KT or 14KT gold is used to make diamond jewelry. 22KT gold is less commonly used because its nature is too soft to be set with diamonds.
Suppose we buy a diamond ring, the amount to be paid for this jewelry is calculated as follows:
(18KT/14KT gold price x weight of gold in the ring) + (Diamond price is calculated according to 4C standard x diamond weight) + Crafting fee + GST (Goods and Services Tax).
In addition, to authenticate the quality of the diamond, most jewelers are usually issued a certificate of authenticity. This sheet will have a photo of the jewelry and related information.
Quality evalution
4C testing is essential before purchasing diamond jewelry. 4C is a globally accepted set of standards to ensure the quality of diamonds. These include:
Color (Color)
Diamond colors range from colorless (best) to pale yellow (worst). Users grade diamonds on an alphabetical scale from D to Z. In which, D color diamonds are considered to be of the best quality.
Clarity (Purity)
Clarity refers to the clarity of a diamond. Diamonds are natural gemstones so they may contain some form of inclusions or blemishes inside and out. So experts use the scale with different categories like FL (Flawless) which is a perfect and transparent diamond. Meanwhile, levels Included (I1, I2 and I3) appear many impurities and blemishes.
Cut
A rough diamond needs to be cut and polished before it can be used in jewelry. The quality of the cut enhances the beauty and sparkle of the stone. Therefore, the more precise and meticulous the cut, the more expensive the price of the diamond. The rating of the cut is Excellent (EX) – excellent, Very Good (VG) – very good, Good (GD) – good, Fair (FR) – average and Poor (PR) – poor.
Carat (Carat Weight)
Carat is the term used to refer to the physical weight of a diamond. One carat weighs 0.2 gr or 200 mg. Generally, the higher the carat number, the greater the diamond’s value. However, diamonds of the same carat weight can still have different prices depending on the remaining 3C rating (color, clarity and cut).
Resale value
When buying diamond jewelry, people also need to pay attention to their resale. Most jewelers offer 90% of the prevailing diamond price at the time of sale. However, if we want to exchange diamonds, the price will fall between 90-100% of the current level.
In addition, because there is no specific benchmark price, the customer may not know whether the actual value of the diamond has increased or decreased. However, they can contact a jeweler or specialist for an accurate valuation.
Sharma and Shah both point out that diamond prices have increased by 30% over the past two years. Even so, why is the diamond’s resale value only 90% of the current price? Experts say the reason is that unlike gold, diamonds cannot be melted, cut or polished to make another piece of jewelry.
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