How to Buy Diamonds

People buy loose diamonds for future use in jewelry or as investments.

A diamond traditionally graces engagement jewelry because the lustrous gem's durability and beauty act as a symbol of the relationship. Investors purchase the gemstones for the same reasons; the distinctive appearance of an investment-grade diamond makes it impossible to counterfeit, while the stone's hardiness protects it from damage. Either as an investment or as jewelry, diamond purchases require an understanding of the "four C's"-- cut, color, clarity and carat weight -- that comprise the Gemological Institute of America's diamond quality standards.

Things You'll Need

• Loupe or magnifying glass
• White paper
• Scale

Instructions

Cut

1. Examine a loose diamond under bright light to determine the quality of its cut. "Cut" refers to how well the stone's shape scatters light, not to its overall shape. An excellent cut reflects the maximum amount of light through the large table facet at the top of the diamond.

2. Look at the proportions of the pavilion, the pointed base of the diamond, to its crown, the shallower facets that make up its top surface. An overly deep pavilion creates a dimmer diamond, while a too-shallow pavilion allows too much light to pass through the clear stone instead of bouncing back to the viewer's eye through its crown.

3. Look directly down at the crown of a marquise-shaped diamond to examine it for a "bow tie." This diamond shape exhibits two darkened areas of light extinction at its center when its cut is less than excellent; these zones resemble a black bow tie.

4. Examine pear-shaped and heart-shaped diamonds for central zones of extinction similar to the bow tie effect in marquise diamonds with good or fair cuts. Zones of extinction occur when a diamond with pointed shapes receives a deep cut that leaves shadows within the stone.

5. Flip the loose diamond onto its flat crown and examine it with its pointed pavilion facing your eye. Use a jeweler's loupe to examine the tiny facet at the tip, the culet. A large culet facet could permit light to leave the diamond through its base, so choose a diamond with a small or non-existent culet.

Color

1. Place the diamond pavilion side up on white paper under natural sunlight or balanced-spectrum light. Full-service jewelry stores and diamond sellers can provide appropriate lighting for potential investors and jewelry buyers.

2. Remove any colorful items such as other gemstones or articles of clothing from the vicinity of the diamond. These items could impart a color cast to the stone that it would not otherwise have.

3. Examine the stone for traces of yellowish or brownish tints. Pay close attention to the stone's edges where colors show up most vividly against the white paper.

4. Compare the stone's color against the GIA's color rating scale. Diamonds with a D, E or F classification command the highest prices and receive the appellation "colorless." Jewelers term stones with a G through J ranking "nearly colorless" and frequently use them in jewelry, while gems with lower letters have more obvious coloration.

Clarity

1. Look for any obvious flaws within the stone with unaided eyes. White filmy inclusions, black carbon flecks and tiny internal gas bubbles affect the diamond's appearance and lower its value.

2. Use the loupe or magnifying glass to look at the stone from the top down. A "loupe-clean" diamond bears an IGA rating of FL (flawless) or IF (internally flawless) and commands a high price for its rarity. Investment diamonds and high-quality jewelry diamonds fall into these categories.

3. Turn the stone over to rest on its crown and look at it through the pavilion with the loupe. A diamond with flaws visible only from its underside loses less of its value than one with flaws visible at its crown.

Carat Weight

1. Clean the diamond with an alcohol swab to remove any impurities on its surface. Jewelers' scales measure in such small increments that even a thin layer of dust could add weight to a stone, artificially inflating its cost.

2. Place the diamond on the jeweler's scale with tweezers to avoid adding mass to the scale's pan or to the gem with oil from the fingertips.

3. Note the gem's weight in relation to its dimensions, as these figures inform a jeweler about the diamond's cut. A heavy diamond with a small diameter probably has a deep pavilion, for example. This kind of interrelation between the "four C's" helps expert jewelry appraisers assess a diamond's value more accurately but also allows buyers deeper insight into diamond grading.

Making the Purchase

1. Consult with a gem dealer or jeweler about the purpose of the purchase. The high standards investors place on investment diamonds puts a high price on these stones, but jewelry buyers can find suitable stones at considerably lower prices.

2. Discuss any applicable discounts on the stone with the dealer. Jewelers can help jewelry buyers decide which of the "four C's" they consider most important and help them choose a significantly less expensive stone that still meets their standards. For example, a bride with slender fingers might place a premium on a stone with excellent clarity, color and cut but want a smaller carat weight.

3. Inquire about replacement plans for jewelry diamonds. Jewelry stores typically offer a warranty program that will replace a lost stone for a small fee or for free if the buyer regularly returns to the store for jewelry maintenance.

4. Ask about sales. While investment diamonds do not typically go on sale, jewelry stores regularly offer promotional prices on loose and set diamonds.

Tips & Warnings

• A smaller diamond with good cut, color and clarity looks larger than a heavier diamond with otherwise average vital statistics.

• Diamonds with small flaws near their edges represent a significant savings for jewelry buyers. The flaws disappear under a prong or bezel setting, leaving a gorgeous and visibly flawless diamond.

• Jewelers expect price negotiations; paying full price for diamond jewelry is tantamount to paying sticker price for a car.

• Diamonds with less than ideal standards make beautiful jewelry but poor investments.

References

• Gemological Institute of America: About the 4 Cs
• University of Illinois at Urbana-Champaign: Basic Color Grading
• The Mineral and Gemstone Kingdom; The Precious Gemstone Diamond; Hershel Friedman