Carat Weight, Version 2.0
When we published this article on Jewelers.NYC for the first time in 2014 it was about a quarter of a page long – all simple math. Basically, “Carat Weight, Version 1.0” explained: 1 carat weighs 0.2 grams, 2 carats weigh 0.4 grams, etc. It can also be express in points (jeweler-speak for 1/100th of a carat). A fifty-point diamond is a half carat diamond; a 100-point diamond is a 1 carat diamond, a 150 point diamond is 1.5 carats, etc.
Carat Weight Scale Chart Used With Permission from the Gemological Institute of America.
At that point we thought we were done – BOOM, sixty seconds, the fastest article we’ve ever written! Not much more to say because “carat weight is pretty obvious,” we thought. That was until a reader messaged us recently and ask us three questions:
“Hi Jonathan and Amy, I am going to get engaged soon and want to know which costs more: a G colored 1 carat diamond, or an I colored 1.23 carat diamond? Also, is there a difference in price between a round and an oval cut diamond if they weigh the same? And one last one, can you explain the cost difference in price between a ring with a single one carat diamond and a ‘bunch of small diamonds’ that total one carat?
“Whoa,” Amy and I thought. We’ve got some work to do.”
So, we have basically started from scratch and incorporated what we consider to be the most important information about (and around) the “not so obvious” C, Carat weight.
First, let’s get the math out of the way one more time and then we’re going to take you through some concepts that you might not totally appreciate, but when they hit you, you will realize that everything about a diamond’s value is about “rarity.”
As Carat Weight version 1.0 stated, Carat Weight is straight math. 1 carat = 0.2 grams, or 1/5 of a gram. In fact, a diamond is so light, that there are 141.7 one carat diamonds in one ounce. If you were to fill an empty 12 ounce soda can with 1 carat diamonds, you would need over 1700 of them. You get the point. The math suggests that these tiny little objects are worth a lot of money – and they are.
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Rarity (and Value)
The entire diamond price game is based on one and only one thing. The rarer the diamond’s attributes, the more valuable the diamond. A G colored stone is worth more than an I colored stone because there are less G colored stones in the world. A 22 carat, H colored, VS1 clarity, Excellent Cut diamond is worth many multiples more than 22 one carat diamonds with the same characteristics because there are not a lot of 22 carat diamonds in this world, but there are many one carat diamonds.
Carat Weight and Diamond Value
This means that the question that Leopold asked (“which costs more, a G colored 1 carat diamond, or an I colored 1.23 carat diamond?”) can’t be answered in a one line message, because there is not one clear answer, there are many depending on clarity, cut and shape among other things.
Calculating Carat Weight Correctly
Carat weight is calculated to the nearest two decimal places. If a diamond weight is expressed in three decimal places, the convention is to round down if the third decimal is 4 or less (1.234 carats = 1.23 carats) or round up if it’s 5 or more (2.675 carats = 2.68 carats).
Total Carat Weight versus Single Stone Carat Weight
Remember the example above about the 22 one carat diamonds vs the one 22 carat diamond? The same is true with smaller diamonds. Many of you have seen the diamond ring with many small diamonds that seem to lay like paper on the plane of the ring. These very small diamonds are called Melee (rhymes with belly) and are far less expensive than one single diamond of the same size. An owner of a Melee ring can have several carats of small stones spread across the face of a ring and it will not be nearly as expensive as one carat of a stone of the same color, cut and clarity.
Total Gem Weight vs Total Carat Weight
There are two other concepts to think about: Total Gem Weight and Total Carat Weight. On rings with more than one type of stone, the concept of total gem weight applies. This is the weight of all stones, diamonds and other, added together. Practically speaking, total gem weight is an interesting statistic but it is not one that can be used to assess value, because “gems” include rubies, emeralds, diamonds, saphires, etc. Each has a different value and each has its own set of rarity combinations. So when a jeweler gives you the total gem value, he is giving you a “cocktail party” number.
Back to rarity. If a jeweler were to discuss carat weight with a prospective diamond buyer and he said: I have two diamonds of the exact same color, clarity and cut. One is 0.99 carats and one is 1.01 carats. The first is $4850 and the second is $4950 (i.e. both are $4900 a carat), which do you think virtually every customer would buy? If you said the 1.01 carat stone you would be correct. Why?
Fade to a cocktail party. Two women are showing off their rings to friends. The first says: my husband bought me a wonderful diamond that is just under a carat. The second says, my husband bought me a wonderful diamond that is just over a carat…
How about the other way? A man walks into a jeweler and says “I want to buy the love of my life a diamond engagement ring.” What do you have that is about $5000? The jeweler says we have two stones of identical color, cut and clarity in that price range. One is 0.99 carat for $4850 and one is 1.01 carats for $4950… Which way do you think the groom will go if the other 3 C’s are the same??? Of course 1.01 carats…
There is an emotional attachment to magic numbers (divisible by .25 carats). The price swing can actually be significant because of the once in a lifetime nature of a diamond purchase: most people would gladly pay the extra few dollars (if that’s all it actually cost) to get the slightly larger stone that is over the magic number. How much more would they be willing to pay? That is subjective and based on too many variables to list here, but it’s reasonable to assume as much as 15 to 20% more.
So if you are “smarter than the average bear” then you can get probably get at least 10% and maybe even 15-20% off an (almost) identically sized diamond by going slightly under, rather than slightly over the 0.50, 0.75, 1.00, 1.25, 1.50, 1.75, 2.00, etc. carat weight mark.
Balancing the 4C’s
This note was about carat weight, but there is far more to carat weight than just knowing that a one carat diamond weighs 1/5th of a gram. It’s about know the rarity trade-offs where supply and demand meet to form a value proposition that buyer and seller agree upon.