How to Buy Diamonds

November 27, 2013, 1:46 P.M. ET

How to Buy Diamonds

By Robert Milburn

Simply must buy yourself or your spouse a diamond? If you’re not up on gemology lingo, stumbling down New York City’s Diamond District on 47^th Street can be an intimidating business. That’s why Penta caught up with the diamond experts at Leviev, famous for breaking through the De Beers stranglehold on the diamond industry, to get the low-down on selecting the proper diamond.Carats are just one of the many items you need to take into consideration when buying a diamond. Leviev’s most precious stones come to its manufacturing facility on 5^th Avenue in New York City, where David Klein, Leviev’s president, oversees dozens of diamond cutters and polishers. They work six days a week transforming the rough diamonds just out of the ground into the jewelry we see in their boutique windows. (For more on Leviev, see our previous reviewof their yellow diamond heart-shaped pendant necklace.)

In Leviev’s manufacturing facility, where they use high-tech gadgetry like lasers and 3-D imaging to maximize the number of stones and quality, a rough cut diamond typically looses 50% or more of its original carat weight, as they slice and dice it into multiple diamonds. They have to. Stones come out of the ground inherently flawed and the artful cutting is a means to extract the most jewelry-suitable diamonds out of the rough and flawed rock.

Klein says, when buying a diamond, you first need to get your hands on the diamond’s Gemological Institute of America report, that’s the nation’s foremost quality gem certification company, though others like the American Gem Society andEGL USA are also in the business.

“You have to trust the person you’re buying from,” Klein explains, “but seeing the GIA report is a must.” This documentation is standard when purchasing fine jewelry, with the GIA’s criteria and quality assessment spelled out plainly in order to determine the stone’s value. (To read a nightmare story on how one jewelry expert got taken, even with a gemologist’s report, read “False Promise.”)

After you’ve secured the GIA gemology report, assess the diamond on its overall merit. Just because you’ve got an enormous diamond with a hefty carat weight (one carat equals 200 milligrams), it doesn’t necessarily mean the diamond you have is terribly valuable. That’s why, Klein says, you have to understand the four Cs— cut, clarity, carat, and color— because any one factor doesn’t tell the whole story.

The cut of a diamond refers to its geometric makeup. A round diamond is of course the most common shape, while a cushion cut, which is square or rectangular with rounded corners and curved sides, is more specialized and harder to find. Though there is a grading system for how the stone has been cut –the top marks being “Excellent,” “Very Good,” and “Good”— a word of caution. The GIA only rates round cut diamonds, because standards vary. The GIA admits, “After more than 15 years of research… the most exciting and reassuring conclusion of our research is that there is no single set of proportions that defines a well-cut round brilliant diamond.”

The GIA has developed software that analyzes the quality of round cuts, but consumers, Klein says, should carefully study the symmetry of a diamond’s shape, especially in specialized cuts. The right stone requires a sharp-eyed aesthetic judgment on your part. “It’s important, if you’re buying a heart-shaped diamond, that it looks like a heart,” he says. That means not too squat, deep or long.

Clarity, meanwhile, is more measurable and less of a judgment call. It refers simply to the diamond’s internal flaws, also called inclusions, and external blemishes. Details of these flaws will be in your GIA report. The clarity scale starts with “Flawless,” then “Very Very Slight,” “Very Slight” and “Slight Included.” Price ranges, for a five carat diamond, can vary from, say, north of $500,000 for a flawless rock, to about $50,000 for a stone with slight inclusions, according to a quick search on gem retailer Blue Nile.

The diamond’s color grade will also be on your gemology report. Your standard diamond is rated on a scale from “D,” which is colorless, to “Z,” or light yellow. Colored diamonds, like yellow, pink and blue, are rarer and graded on a different scale using nine descriptors of color saturation—the top three being “Fancy Vivid,” “Fancy Intense,” then “Fancy Light.” Just as the symmetry of the diamond’s cut is important in a specialized shape, the intensity of color is paramount when assessing colored diamonds. But Klein says great cuts and excellent clarity add value to colored diamonds, too.

Still, after you’ve sifted through the gemology reports and have selected your favorites, forget all the wonky jargon and let raw emotion dictate your purchase. “You can look at two very similar stones, but one just happens to draws you in,” Klein says.

Translation:  At the end of the due diligence, a diamond that sets your heart racing is the best diamond there is to give.