How is 1 Carat of a diamond estimated and how much is it worth?
Carat describes the weight of a diamond. One carat is equivalent to 0.2 grams and is split into 100 points. One carat or more is named a “carat”, for example, a 1.5 carat. With diamonds, there are “magic thresholds” which lead to price jumps. A 1-carat diamond, for example, costs significantly more than a 0.95-carat diamond, although the difference in size is barely noticeable. So you can sometimes save money by buying a diamond that is only slightly lighter. 0.5 carat, 1 carat, 1.5 carats and 2 carats are carat weights at which price jumps are the most pronounced.
Diamond 1 carat – the cost of a stone is not so easy to determine, it is impossible to give an exact figure without knowing additional factors. The most important parameters in determining the price of a diamond are four indicators, the so-called rule of four Cs: cut, clarity, color and carat size. Thus, to find out the cost of a diamond carat, all these characteristics must be considered. In addition, fluctuations in the price of stones will influence the price of diamonds in the market.
Historically, the price is determined in US dollars per carat. Even in countries where, by law, the value of any product must be stated in national currency in all documents, dealers are calculated in US currency. The main reference point for them is the Rapaport price list, which is updated and published in New York. Such a price list does not reflect buy or sell prices, but only the opinion of Rapaport corporation experts. This list is fundamental for negotiating between dealers and setting prices. It based the experts of this corporation on the state of the market for processing the extraction and sale of raw materials.
The Rule Diamond 4’C
When determining the value and Worth of diamonds, the following parameters are considered, let’s have a look;
1. The First C – weight (Carat weight)
As the volume of a diamond increase, the price in dollars per carat does not increase in direct proportion. Let’s take a medium-quality diamond as an example and estimate the approximate price increase for it depending on the size. They set prices for size ranges:
- 0.5-0.69 carat
- 0.7-0.89 carats
- 0.9–0.99 carats
- 1.00-1.49 carats
- 1.50-1.99 carats
For an average stone, the cost of 1 carat of a diamond in the second category relative to the first will be 45%. The third category of gem weight will increase the price by 25%. A diamond that is in the fourth category by weight will be 20% more expensive. Diamonds weighing between 1.5 and 2 carats will be 28% more expensive per carat. Further, the price will already increase exponentially, because diamonds over 2 carats are a rarity.
The principle by which they valued diamonds is called the Tavernier Rule: the value of a stone is equal to the product of the weight in carats squared by the value of one carat. A cut diamond weighing two carats is three times more expensive than a diamond weighing one carat, and a diamond weighing three carats is 10 times more expensive. This rule only applies up to five carats. A 10-carat diamond will be 100 times more expensive than a 1-carat diamond, and 25-carat diamonds are so rare that they gave them names.
2. Second C – Cut, cut quality
Defining a metric is not straightforward, and several additional factors need to be considered doing so. The quality of the cut increases the value of the stone. But, for example, good and very good cut quality does not have such a big price difference as other parameters.
Diamonds with a low cut have a lower value. The price lists do not separately prescribe the quality of the cut, and its effect on the increase or decrease in price may be dictated by a particular stone or seller. This parameter is usually very subjective.
3. Third C – Clarity, Purity
The fewer inclusions in the stone and the smaller their size, the correspondingly higher the cost per carat. If, for example, you take a diamond weighing one carat and increase its clarity parameter by four steps, then with each step the price will rise by about $ 1,000. However, the price gain will decrease as it approached the maximum purity value. Since in the highest indicators of this parameter, the difference is not so strong.
4. Fourth C – Color
The color parameter affects the price of a diamond slightly differently: the more transparent the diamond, the higher the value. The increase in prices is an exponential progression, and besides, it is impossible to notice such a difference in shades without a device.
Purity and Polish
Purity means that a diamond should be as free of cracks and cavities as possible. It is called “flawless” if no flaws can be seen at ten times magnification. Finally, when it comes to the cut, it is assessed how carefully the diamond cutter has worked. This since 13. The technology used in the 19th century produces what makes the diamond so special and desirable: its strong luster and the ability to split light into its spectral colors.
Diamonds Weighing 1 carat
Such stones are large and have a size of 6.5 mm. They are in demand among investors and have high liquidity.
They have a very wide price range. The price of such a stone with the highest characteristics in terms of color and clarity can reach 300 thousand dollars. Whereas the price of a stone with average values can start from several thousand.
How do you Compare Stone Prices?
Besides the major factors, minor factors can also affect the cost. For example, stones with the same parameters of color purity and weight, but having different inclusions, can differ in price. The same situation can arise with color because, with the same saturation, the stone can have different shades, which are not equally perceived by buyers. Nuances that can affect are revealed in such parameters as the quality of cutting, polishing, crystal symmetry.
In addition, it must also certify diamonds in the same laboratory for comparison. The reference is the assessment of the Gemological Institute of America. And the ratings of other private laboratories can vary significantly. Most often, the characteristics of such laboratories are overestimated, and it is not possible to determine how much.
Why will the Price of Diamonds continue to rise?
The diamond reserves or diamond deposits are finite (limited). Similar to other raw materials, such as crude oil, gold, rare earth, diamonds cannot be mined indefinitely, as their deposits are becoming ever smaller. The effort that the mining companies must make to extract one carat of high-quality diamonds is constantly increasing and is often already on the threshold of profitability.
Some of the formerly productive diamond mines are exhausted and closed or are not further reduced. One of the world’s largest and most famous diamond mines, the ARGYL mine from Australia, was closed at the end of 2020!
This means that the supply will continue to decrease in the future. The global demand for diamonds will grow, as more and more former emerging countries are now industrialized countries and it drove the demand for diamonds from there. In these countries, in particular, diamonds are a popular symbol of prosperity and success.
The diamond price is not subject to any central price setting. It is, therefore, a real “market price”, which results from supply and demand.
In the long term, the diamond price has always risen. This is because global diamond production usually cannot meet the demand for diamonds that are suitable for jewelry and investment purposes.
With a few short-term exceptions, the demand has always been greater than the production of high-quality diamonds. As a result, the diamond price has risen in the long term and all probability will continue to do so.
The most expensive stone in the world is pink
Diamonds come in many different colors. Many colors such as pink, black, blue or lemon yellow are particularly popular and fetch enthusiast prices. The most expensive ones are usually the light and white ones. As the most expensive diamond of all time, a pink diamond was auctioned off in 2010 by Sotheby’s action house in Geneva. The stone with a weight of 24.78 carats achieved a record sum of almost 34 million euros.
A Ring with a 1 Carat diamond
If it added a certificate from the same laboratories to the same color, size and clarity, you need to pay attention to parameters such as cut, symmetry and polish. Depending on the quality of these parameters, the cost may differ by 30%. Another point that has an impact is fluorescence. Its maximum level can reduce the cost of the stone by another 5-10%.
Important note
Of course, this statement only applies to natural diamonds. Synthetically produced diamonds or lab it can produce indefinitely grown diamonds, are therefore not uncommon and therefore definitely not suitable as an investment! The diamond price for a one-carat diamond of the best quality was approx. $ 2,700 and cost around $ 25,000 in 2010!
How to Wear Diamonds?
They should wear large stones one at a time. Do not hang yourself with many stones it will look like rhinestones or jewelry. One stone in a decent cut is quite enough. Round-shaped stone cuts such as heart, marquise, teardrop and others look best. A large stone has 57 facets and a small one – 17. One of the Most Famous and Prefer Round Brilliant Cut Diamond Ring is Worthy and Trendy one.
Diamonds are best paired with platinum and white gold jewelry. It does not combine rose gold with diamonds, giving them a yellowish color. The silver reacts and tarnishes.
Brilliance is the phenomenon of the reflection of light rays in the facets of a stone. It is more pronounced in enormous diamonds and cannot be seen in small ones. Brilliant is a wonderful sight. It attracts attention and is more pronounced in stones with high purity and processing.
Diamonds are not only an excellent piece of jewelry but also a wonderful investment. It is profitable to invest in high-quality stones, which are sold separately. Stones in jewelry lose their value as they are used, therefore, they are rather luxurious accessories.