whys is this so "cheap"?

[addiction]

http://www.abazias.com/database/NewDiamondInfo.asp?stock=46580290

is it because the "Ideal" cut and the EGL certification? The proportions seem to be ok. With default angles on HCA, since there are no details) it scores 0.6

any opinions?

thanks.

 

[Lorelei]

EGL uses percents for crown and pavilion angles which are said to not be as accurate, but without them we really can't tell much unfortunately. EGL often has a lower pricetag than AGS and GIA, as to how much, this can vary, nor can we tell which branch of EGL graded this diamond such as Israel, USA etc. Are you actually interested in this diamond, or just curious?

 

[neatfreak]

Date: 5/26/2008 1:02:03 PM
Author:addiction
http://www.abazias.com/database/NewDiamondInfo.asp?stock=46580290


is it because the ''Ideal'' cut and the EGL certification? The proportions seem to be ok. With default angles on HCA, since there are no details) it scores 0.6

any opinions?


thanks.

Well you absolutely cannot use default angles on HCA to tell you anything about this stone as you have no idea what THIS STONE''S angles really are ya know? So that score doesn''t mean anything unless you have all the info about this stone. Still could be a total dog as EGL isn''t known to be super strict in their grading.

 

[Ellen]

Date: 5/26/2008 1:10:51 PM
Author: neatfreak


Well you absolutely cannot use default angles on HCA to tell you anything about this stone as you have no idea what THIS STONE'S angles really are ya know? So that score doesn't mean anything unless you have all the info about this stone. Still could be a total dog as EGL isn't known to be super strict in their grading.

I would add, except for the USA division. According to the experts, and some posters on here, they seem to be fairly spot on.

 

[neatfreak]

Date: 5/26/2008 1:16:56 PM
Author: Ellen

Date: 5/26/2008 1:10:51 PM

Author: neatfreak



Well you absolutely cannot use default angles on HCA to tell you anything about this stone as you have no idea what THIS STONE''S angles really are ya know? So that score doesn''t mean anything unless you have all the info about this stone. Still could be a total dog as EGL isn''t known to be super strict in their grading.

I would add, except for the USA division. According to the experts, and some posters on here, they seem to be fairly spot on.

Good point Ellen!

 

[addiction]

I am interested in similar stones, maybe not this one in particular since I am biased by the EGL certification and not being able to see the stone before buying it. I requested additional information from the website to find the actual proportions. Can someone like me request that the store get an AGS or GIA certificate before I buy it?

Unfortunately for me, I keep waisting precious study time lurking this forum because I can't get the ring I saw at Tiffany's out of my mind..... I am just baffled at the evident HUGE price difference for the stone itself, so I decided to combine study and obsession and build a price regression model taking into consideration beside "regular" price determining variables (4C, polish, symmetry) a few other dummy variables like AGS/GIA/EGL/OTH, PremiumStore, WholesalePrice, AuctionPrice and PreOwned. I think I'll regress this by shape, to make sense of comparison.

Right now I'm just getting acquainted to all the pricing parameters involved into pricing a diamond.

There are probably statistical studies out there on diamond pricing, but I'd rather do the work myself.

Any help with recent data would be greatly appreciated, as right now I'm just using search engines and the copy/paste is a little tedious... I think a sample size of about 10,000 observations would be statistically significant for starters.

thanks.


edit: looks like pricescope's search has about 225,524 records... nice, maybe some help from someone here, like a db file?

thanks Dan.

 

[neatfreak]

If you just tell us what you want and your budget we can help you get the best bang for your buck, no regression model needed.

 

[JulieN]

Date: 5/26/2008 1:28:34 PM
Author: addiction
I am interested in similar stones, maybe not this one in particular since I am biased by the EGL certification and not being able to see the stone before buying it. I requested additional information from the website to find the actual proportions. Can someone like me request that the store get an AGS or GIA certificate before I buy it?

Yes, but it takes a long time for GIA, and an AGS member has to send it to AGS.

If you're looking for rounds, it is just easier to filter for AGS/GIA stones. No shortage of rounds.

There are some Tiffany solitaires on Signed Pieces.

 

[addiction]

Date: 5/26/2008 2:28:57 PM
Author: neatfreak
If you just tell us what you want and your budget we can help you get the best bang for your buck, no regression model needed.

yes, but that's way too easy... kinda' like going to T&Co or HW.... except without the bang!.. just the buck....

my initial model "priced" a 1.25 H VS2 EX/EX/EX at $8,294.52

$8,452 WF 1.228 H VS1 EX/EX/EX

I'm sure right now it's just a simple coincidence as just Carat, Color and Clarity are statistically significant at 95% confidence level (...expected...) but I still need to figure out how to include proportions (cut) in the analysis, similar to HCA score.

 

[strmrdr]

getting the db would not help you.
Diamonds in the trade are sold on the actual color and clarity and cut not the lab report when it comes to soft reports and since the PS database is trade price + markup you cant do a comp unless you know the actual grade to the AGS/GIA level of grading accuracy.

Same with ags vs gia when it comes to cut, less so with color and clarity and finish because they are pretty close.

 

[addiction]

Date: 5/26/2008 6:16:19 PM
Author: strmrdr
getting the db would not help you.

Diamonds in the trade are sold on the actual color and clarity and cut not the lab report when it comes to soft reports and since the PS database is trade price + markup you cant do a comp unless you know the actual grade to the AGS/GIA level of grading accuracy.


Same with ags vs gia when it comes to cut, less so with color and clarity and finish because they are pretty close.

I understand that no 2 diamonds are the same, but surely extremely similar gems (4C, angles, %, and the rest) certified by the same lab should cost the same??? I''m not trying to price the diamonds that are not graded, but rather rely on the top labs'' accuracy...

The difficulty with quantifying the appeal of a gem based on cut was obviously (to me, at least) the reason for developing HCA and Tolkowsy''s work, so I think one can similarly monetize the proportions in a pricing model. There would be a disclaimer to that model, of course....

 

[strmrdr]

Date: 5/26/2008 8:58:12 PM
Author: addiction


I understand that no 2 diamonds are the same, but surely extremely similar gems (4C, angles, %, and the rest) certified by the same lab should cost the same??? I''m not trying to price the diamonds that are not graded, but rather rely on the top labs'' accuracy...

The difficulty with quantifying the appeal of a gem based on cut was obviously (to me, at least) the reason for developing HCA and Tolkowsy''s work, so I think one can similarly monetize the proportions in a pricing model. There would be a disclaimer to that model, of course....

It don''t work that way the exact same diamond in different markets and depending on what goes with it like trade in and buy back and just information like extra pictures and reports can have a price range of several hundred to several thousand dollars.

 

[addiction]

Date: 5/26/2008 9:22:50 PM
Author: strmrdr

Date: 5/26/2008 8:58:12 PM

Author: addiction



I understand that no 2 diamonds are the same, but surely extremely similar gems (4C, angles, %, and the rest) certified by the same lab should cost the same??? I'm not trying to price the diamonds that are not graded, but rather rely on the top labs' accuracy...


The difficulty with quantifying the appeal of a gem based on cut was obviously (to me, at least) the reason for developing HCA and Tolkowsy's work, so I think one can similarly monetize the proportions in a pricing model. There would be a disclaimer to that model, of course....

It don't work that way the exact same diamond in different markets and depending on what goes with it like trade in and buy back and just information like extra pictures and reports can have a price range of several hundred to several thousand dollars.

strmrdr, what you're saying doesn't make any sense to me... extra pictures and reports? There has to be a standard for market prices... What is the base then for Rapaport's list if prices can't be compiled and economically justified? I'm sure that probably all respected diamond jewelers know by heart how much a certain piece is worth based on brief description (ballpark, of course). All I'm trying to do is get the same ballpark figgure, without the years of experience and without seeing thousands of stones...

 

[purrfectpear]

The ballpark is the price they''re asking. There will always be variances (sometimes substantial) due to the length of time in inventory. Not all jewelers reprice even when diamonds go up in value. That''s why occasionally you can luck into a deal.

 

[Sharon101]

No offence but you are trying to be too clever. The info is even more in shades of grey than you realise. You are trying to be an appraiser or do the job of someone who had to work and study for years to know how to factor in the variables. Your model will be flawed for reasons you are not aware of. eg the price is not just from the individual variables, but from the unique combination of certain variables. eg. rough example....in a perfect diamond over say 2 carats the color `D` will add more to the cost than the color `D` will to a flawed diamond under .5 carats. So sometimes the unique and rare combination adds more value than each attribute in its own right. Anyway, its complicated....thats all I know!!!

 

[addiction]

Date: 5/26/2008 11:14:57 PM
Author: Sharon101
No offence but you are trying to be too clever. The info is even more in shades of grey than you realise. You are trying to be an appraiser or do the job of someone who had to work and study for years to know how to factor in the variables. Your model will be flawed for reasons you are not aware of. eg the price is not just from the individual variables, but from the unique combination of certain variables. eg. rough example....in a perfect diamond over say 2 carats the color `D` will add more to the cost than the color `D` will to a flawed diamond under .5 carats. So sometimes the unique and rare combination adds more value than each attribute in its own right. Anyway, its complicated....thats all I know!!!

Sharon, I appreciate your feedback. The relation you described could be incorporated into the model. Unfortunately, I have enough stats skills to know it's possible, but it's been a while since grad school or using Matlab.... maybe there is a stats expert lurking around this forum that would be willing to take on a challenge....

Where there is a will, there is a way....


edit: I know.... I should get my brother to help me out with this, he used to teach stats at SU...

the only problem is no one knows I'm looking for a diamond...

 

[strmrdr]

I had a long reply wrote out and the board ate it so here is the short sweet and to the point post.

There isnt one diamond market lets leave location out of it because every country has its own markets.
In the US it goes something like this, high to low price....

Wholesale: memo,single,small lot, large lot,contract, bulk

low to high price retail

Retail: internet drop shipper, internet min. info, internet full info, competitive b&m, b&m/chain, mid level b&m, high end b&m(tiff)

There is some overlap as some min. info and full info internet dealers are also b&m's.

Each of those markets has a different price for the same diamond.

 

[addiction]

Date: 5/26/2008 11:49:03 PM
Author: strmrdr
I had a long reply wrote out and the board ate it so here is the short sweet and to the point post.


There isnt one diamond market lets leave location out of it because every country has its own markets.

In the US it goes something like this, high to low price....


Wholesale: memo,single,small lot, large lot,contract, bulk

Retail: internet drop shipper, internet min. info, internet full info, competitive b&m, b&m/chain, mid level b&m, high end b&m(tiff)


There is some overlap as some min. info and full info internet dealers are also b&m''s.


Each of those markets has a different price for the same diamond.

thanks for the insight, strmrdr. I believe you were describing low to high.

Obviously, based on the data set used, you would "price" the diamond in the market where the data came from. I am looking only at retail right now, that''s where I would buy it from. As to internet vs. b&m, those variables can be quantified and included in the analysis.

Bottom line is if the internet drop shipper or anyone else from the retail market tells me he/she has an AGS/GIA 1ct etc, I want to know what it''s worth based on previous sales in the retail market. I don''t see why that would be so difficult? Certainly an appraiser would give you an estimate looking at the stone, hopefully it will be an accurate one. I''m just asserting that I should be able to "price" a diamond based on industry recognized standards and creative statistical modeling.

 

[strmrdr]

Date: 5/27/2008 12:07:08 AM
Author: addiction


thanks for the insight, strmrdr. I believe you were describing low to high.

Obviously, based on the data set used, you would 'price' the diamond in the market where the data came from. I am looking only at retail right now, that's where I would buy it from. As to internet vs. b&m, those variables can be quantified and included in the analysis.

Bottom line is if the internet drop shipper or anyone else from the retail market tells me he/she has an AGS/GIA 1ct etc, I want to know what it's worth based on previous sales in the retail market. I don't see why that would be so difficult? Certainly an appraiser would give you an estimate looking at the stone, hopefully it will be an accurate one. I'm just asserting that I should be able to 'price' a diamond based on industry recognized standards and creative statistical modeling.

I fixed the post, I rewrote it in a hurry,,, wholesale is high to low retail is low to high.
There is a ton of overlap you could spend decades trying to make heads or tails of the pricing mess even with the same stone.

An appraiser will give you the price for one market and one condition. (some maybe 2 or 3)
For example local market b&m fair market value is a totally different number than insurance Internet replacement cost.

 

[JulieN]

Date: 5/27/2008 12:07:08 AM
Author: addiction


thanks for the insight, strmrdr. I believe you were describing low to high.

Obviously, based on the data set used, you would ''price'' the diamond in the market where the data came from. I am looking only at retail right now, that''s where I would buy it from. As to internet vs. b&m, those variables can be quantified and included in the analysis.

Bottom line is if the internet drop shipper or anyone else from the retail market tells me he/she has an AGS/GIA 1ct etc, I want to know what it''s worth based on previous sales in the retail market. I don''t see why that would be so difficult? Certainly an appraiser would give you an estimate looking at the stone, hopefully it will be an accurate one. I''m just asserting that I should be able to ''price'' a diamond based on industry recognized standards and creative statistical modeling.

Hah...well, some might ask why you are being so...insistent?

 

[addiction]

Date: 5/27/2008 12:15:15 AM
Author: JulieN

Date: 5/27/2008 12:07:08 AM

Author: addiction



thanks for the insight, strmrdr. I believe you were describing low to high.


Obviously, based on the data set used, you would 'price' the diamond in the market where the data came from. I am looking only at retail right now, that's where I would buy it from. As to internet vs. b&m, those variables can be quantified and included in the analysis.


Bottom line is if the internet drop shipper or anyone else from the retail market tells me he/she has an AGS/GIA 1ct etc, I want to know what it's worth based on previous sales in the retail market. I don't see why that would be so difficult? Certainly an appraiser would give you an estimate looking at the stone, hopefully it will be an accurate one. I'm just asserting that I should be able to 'price' a diamond based on industry recognized standards and creative statistical modeling.

Hah...well, some might ask why you are being so...insistent?

haha... Julie, it seems that the more I look into this, the shadier

it gets.... with all these diamonds online, I really see no difference between buying WF, GOG, Blue or any other if the stone is "exactly" the same. If it's customer service, fine, we'll rate that and include it too... anyhow, regression models have been used successfully in other industries (home valuations, securities to name a few). Diamonds seem to be the perfect candidate for a regression since they have sooooo many independent variables to play with

strmrdr, I'll keep it simple for now and look at only online and a few "established" b&m.


edit: just to explain to folks that might not have a clue what I'm talking about (no offense), the end result should be something like (this is just an EXAMPLE!):

Y = 1,000 + 800 x Carat + 600 x Color + 1,500 x Clarity + 400 x Lab + 100 x Symmetry + 600 x Polish + 200 x Fluorescence + E

where:
Y = Expected price (dependent variable)
E = Error term

 

[addiction]

it just occurred to me that I can''t use a normal distribution as the price can''t be negative

(that would be nice)... so I''ll have to go with lognormal... oh, well, back to the drawing board

 

[JulieN]

And this is why I never took stats. Probability theory, FTW!

 

[strmrdr]

Date: 5/27/2008 12:52:15 AM
Author: JulieN
And this is why I never took stats. Probability theory, FTW!

Chaos theory describes diamond pricing better than probability theory!
http://en.wikipedia.org/wiki/Chaos_theory

 

[JulieN]

yup, I took that, too. horrible stuff.

 

[addiction]

lol, you guys crack me up....

I wondered who else (other than the end consumer) could benefit from standardized pricing of diamonds and it just occurred to me that maybe in the future we might see diamond contracts traded on NYMEX and CME if there will be strong common ground for pricing... hmmm

a whole world of possibilities.... securitizing diamonds...

 

[strmrdr]

Date: 5/27/2008 1:26:18 AM
Author: addiction
lol, you guys crack me up....

I wondered who else (other than the end consumer) could benefit from standardized pricing of diamonds and it just occurred to me that maybe in the future we might see diamond contracts traded on NYMEX and CME if there will be strong common ground for pricing... hmmm

a whole world of possibilities.... securitizing diamonds...

first step to that and it bombed
http://www.diamonds.net/auction/Press_Release.aspx

here is the results...
most of the diamonds didnt make reserve and very few actualy sold...
http://www.diamonds.net/Auction/PostAuction/Results.aspxhttp://www.diamonds.net/auction/Info_For_Buyers.aspx

 

[arjunajane]

One really has to ask, why

I thought you said you just wanted to buy a 1ct diamond, why make it so hard??

 

[addiction]

Date: 5/27/2008 1:57:00 AM
Author: strmrdr

Date: 5/27/2008 1:26:18 AM

Author: addiction

lol, you guys crack me up....

I wondered who else (other than the end consumer) could benefit from standardized pricing of diamonds and it just occurred to me that maybe in the future we might see diamond contracts traded on NYMEX and CME if there will be strong common ground for pricing... hmmm

a whole world of possibilities.... securitizing diamonds...

first step to that and it bombed

http://www.diamonds.net/auction/Press_Release.aspx


here is the results...

most of the diamonds didnt make reserve and very few actualy sold...

http://www.diamonds.net/Auction/PostAuction/Results.aspxhttp://www.diamonds.net/auction/Info_For_Buyers.aspx

funny that you mention that, I actually registered a few months back, but I haven't seen any auctions lately... the idea of buying at wholesale prices seemed great, even with the 10% on top...


this was not what I had in mind though when I said securitizing diamonds... I was referring more to non-delivery futures contracts (like oil, gold etc) an extravagant idea nonetheless, but very attractive....

 

[addiction]

Date: 5/27/2008 1:57:38 AM
Author: arjunajane
One really has to ask, why

I thought you said you just wanted to buy a 1ct diamond, why make it so hard??

obviously I have too much time on my hands at 2AM and I have to study, which makes any activity other than study highly enjoyable