Couple of questions about C''s and Price

[sed6]

Hello-
I've found all the info here very informative! I'm leaning more and more toward an online purchase vs. B&M. A few questions I hope you all can help me with:

All else being equal, should a VS1 be priced the same as the next VS1? Or will the subjective rating of "eye clean" or the location of the inclusions effect the price?

Is there a standard format or equation for pricing a diamond? For example, again all else being equal, will a VS1 always be X% more than a VS2? What about color? Is an F always going to be X% more than a G?

Perhaps there is some sort of "curve" as opposed to a linear relation involved. For example if G=X and F=X+10% and VS2=Y and VS1=Y+10% then a G/VS2=Z but a F/VS1=Z+25% (not the expected 20%)? Make sense?

I sort of already know that there is no set price guidelines, that is not what I'm getting at. But rather some sort of scale from one color or clarity to the next. Simple observation of online prices shows an F is going to cost more than a G, but the % increase varies from stone to stone. Now 1-2% difference who cares, but 5-10% makes me wonder why one stone shows a greater price jump than the next.

Kinda heady and involved, I know. But seeing somewhat of an inconsistancy in prices make me wonder what I'm missing or don't yet fully understand. I appreciate any insight!

 

[dfm00]

http://www.pricescope.com/RepScope.asp

You can play with this tool for various carat weights and cut grades. I'll leave it to you to derive the formula.

One possible explanation for differences you're seeing is that all else is rarely equal. Subtle or not-so-subtle differences in cut/proportions, for example, can have significant effects on price.


Dave

 

[denverappraiser]

The short answer is no.

Actually, the long answer is still no. Even if it were somehow possible to separate out an individual attribute, like G/H color, you will find the relationship between each color grade to be different depending on both size and clarity. The K/L line at 2.00 SI2, for example, would be at about 50%. That same line for 1.00 VS1 is more like 10%. You can get a pretty good idea for where it belongs in the zone that interests you by using the pricescope database and searching for stones that seem to be similar and then tweaking a single variable. A fairly good benchmark is to sort by price, discard the ones that seem to be errors (usually the top 1 or 2) and average the next dozen or so. This will get you stones that the vendors all count as among their best cut, most accurately graded and best documented.

The major price differential between superficially similar stones has to do with cutting, grading accuracy and the details of the deal. Premium cutting takes more time, waste more material and involves documentation, all of which drive up the prices. This is a subject of great discussion here and I strongly encourage you to dig into it. Grading accuracy is a matter of understanding what it is that’s being discussed. A stone doesn’t become an H because someone says it is. It’s possible to get something of a consensus about it and some graders are far more reliable than others but this is not a matter of ‘fact’ the way weight is. A terrific price on an H color may be no bargain at all if it turns out that the stone should be properly graded as a J. Every deal involves some non-gemological type features like financing, trade in programs, convenient display, prestigious brands, friendly salespeople, good education and the like. Different people value these things differently but it’s important to understand as a shopper what you are and aren’t getting in your deal if you really want to compare offers.

Neil Beaty
GG(GIA) ICGA(AGS) NAJA
Professional Appraisals in Denver

 

[WorkingHardforSmallRewards]

Hi, well I have been doing a lot of looking and researching recently and I can tell you there def. is some fairly consistent % based curve as the different C's change, though as Appraiser points out above (I was writing this and just read his post) there are going to be certain points at which the increase will be more significant than others in equivalent diamonds.
One more question to add, I imagine that there would actually be some ct weight where the % to increase in quality would actually be less than those before and after it.

Bassically I am wondering if the average small diamond consumer has X amount of dollars to spend on a diamond, the price of which lets call x. and in a very small diamond the desire for a higher quality would easily overcome a small percentage change because the small percentage change would be so insignifant when compared to the % of X dollars. (for example, a 10% increase to go from a G to a F in a 300 dollar diamond would only be 30 dollars, and that 30 dollars would be so insignificant compared to the average X income that it would be reasonable to assume it would require a larger percentage to really create a balance in the marketplace.

But as the diamond ct increases to a "moderate" size so does the price of the diamond, lets call it y, and so does the average consumer's income, but I believe, not proportionally.

Thus a consumer would have Y amount of dollars but is purchasing a diamond that 10*x=y --however, Y is not equal to 9-10*X, but perhaps 3*X. An example of this would be a 3,000 dollar diamond VS the 300 dollar diamond above. 10*X > Y, thus the % increase in the cost of the diamond to affect the sales of the diamond per color increase would have to be less to adjust for its influence in the marketplace

But then you have very large diamonds where the price of the diamond, lets call z, is purchased by a VERY affluent portion of the world, lets say with an income of Z.

Here at some ct point the average income may well be Z>=D*Y yet z<=Dy and in this case the
%increase would become greater to accommodate for its lesser impact on the market place.

It would thus be very interesting to me at least to find that derivative of zero and know at which ct range I could purchase the highest quality diamond for the least % increase per quality point.

if there is a mistake in something above let me know! it all got sort of confusing for me...


and thoughts on your post can be found here if you care to read, I originally wrote this at the top but edited as I am sure most people dont want to read it


However, the problem with the researching that you have done is that sometimes there might be a combination of C's changing. Say that the ct increase .05, and the color increased to F then that might well justify the larger percentage increase because of the price curve for the ct and color change combined. Then there are going to be other factors to consider as in is it an in-house diamond that has been given some special label such as HandA or has the polish or symmetry changed--obviously the obvious of has the cut grade changed at all. Does it have fluo? even thought it shouldn't that can cause for a change in price, who gave the lab report and gave it an F, if one is an Excellent GIA listed as Ideal on the website and the other is an AGS "000" cut grade then the AGS 000 may well yield a higher premium even if every dimension listed on the site is the exact same. Also, sometimes they are just available for less because someone is content to make less profit than another person. Then some things such as crown angles and pavilion angles might have caused for an in-house diamond to yield a slightly lower price due to....anyway, I will get off that rant now.

But the point is that while your equations and thinking are certainly reasonable from what I have learned, and if you do some searches here I believe there are several threads dedicated to certain C's and how they affect cost, the actual equations needed to come up with a formula for the % change based on diamond by diamond will be quite complex! There are a lot of things to consider! I haven't studied this in great deal and I sure as he..day, am not going to try to figure it out based on sampling of inventroy prices, I would like to know of some particular %'s myself! so if anyone finds links, post them up!

 

[snlee]

There's no pricing format or equation used. Nothing such as G/VS2=Z and F/VS1=Z+20% can exist. I don't know how a diamond is priced but you have to keep in mind that there's so many different factors involved. You can't come up with an exponential function for pricing a diamond. There's not only color and clarity but also cut and size. And every diamond is different.

 

[Lorelei]

It is best to study the pricing and attributes of the type of diamond you want, then decide where you might be able to compromise on to fit your budget. There are no hard and fast rules.

 

[sed6]

Lorelei- Love your avatar...that's why I'm an underhand paper hanger as opposed to overhand...cats can't roll it off easily!

Thanks all for the input, kinda confirmed what I already suspected.

ETA: Thanks DFM00 for the link, that's great!