Jump to content

Need Advice On Buying A Diamond


SAgosto
 Share

Recommended Posts

Hello:

 

I am new to the forum and new to the diamond world so please be gentle. I been with my girlfriend for about 7 years and want to propose. One of my many problems is that I am very anal and very picky. I often second guess myself about even the most simplistic decision. I hope that these would turn into positive traits in regards to purchasing a diamond. A very good friend of mine is GIA certified but he lives about 3.5 hours away. I could send him the diamond certifications but I'd like to educate myself first.

 

This girl IS the one and I will not settle for anything but the perfect diamond for her. I have easy access to NYC Diamond District and have met with a few jewelers but after talking to my buddy, the "deal", I got wasn't such a deal: 1.62CT/H/VS1/GOOD/63% table for $11K

 

Please help.

 

Some background:

 

I am 29 and a Software Engineer making about 100K per year

Live in Westchester County, NY just outside NYC.

My GF is an attorney in midtown Manhattan

 

I have looked at several stones on Abazias and was very impressed. The basic stats were much better than the "deal" that I got. I could buy a stone and have my buddy look at it and then return it if need be. I guess aside from the basic requirements (4Cs), what else should I look for? My buddy can see subtle differences but I cannot. Yes, the report might be exactly what the diamond is but what else seperates the two? Is it fair to say that two diamonds with similiar stats are equal? Given my price limit, should I consider giving up some color/clarity for more size? To be honest, I am not sure where the better compromise is. That's my problem among others. :)

 

Anyhow, here's what I am considering:

 

PRICE = Up to $11K (Maybe I should increase this?)

SHAPE = ROUND

CARET = 1.6CT or greater

COLOR = G/H or better

CLARITY = VS1 or better

CUT = ??? (The one I was considering was GOOD)

 

There are SEVERAL on Abazias that were in the 1.7/H/VS1 for less money.

Link to comment
Share on other sites

The NYC diamond district is one of the worst places in the country to be looking for a diamond although the cruise ports in the Caribbean and Hill street in LA are close. Fortunately most folks who have easy access to it also have internet access and other ways of shopping elsewhere so you aren’t stuck there. You’ve apparently figured this out. Does your buddy sell diamonds? If so, ask him to assist. Starting with a dealer that you are inclined to trust and who has personal expertise in looking at diamonds is definitely worth a drive. You can do a lot with him by email, FexEx and over the phone by the way.

 

I know nothing about your friend and certainly don’t mean to pick on him but the term ‘GIA certified’ is a red flag if he’s using it instead of you. GIA is a school and they have gobs of graduates but they don’t ‘certify’ graders. It’s true that many qualified graders have GIA credentials, all GIA graduates are not equally skilled at either grading or communicating their results and MOST don’t have the tools and equipment to do it properly.

 

For me, the things that make a stone most attractive are in the category of cutting and the optics and most of these are not included on the lab report. The closest you can come is a summary in the form of the cut grade. For that reason, my first spec would be GIA-excellent or AGS-ideal cutting and would not seriously consider either an alternative lab or a lesser grade. The ‘in person’ question will become one of further selecting from these. Your budget is decidedly low. Do a search at the top of the page titled ‘find online jeweler’ and you can see how the various attributes relate to one another and the price.

 

Given the price as the least flexible attribute, and we’re carving cutting and lab choice in stone, this leaves you with size, clarity and color to adjust. Play with it for a while and see what you come up with.

 

Neil

Link to comment
Share on other sites

The NYC diamond district is one of the worst places in the country to be looking for a diamond although the cruise ports in the Caribbean and Hill street in LA are close.

 

I would expect NYC diamond district to be a good source given the ~90% that they see and the competition. I guess I was wrong. The people were very nice and gave me what I thought was a good deal until I spoke with my buddy. He basically said the basic 4Cs were good but it was not an ideal cut (GOOD/GOOD) and the "table %" was too high.

 

Fortunately most folks who have easy access to it also have internet access and other ways of shopping elsewhere so you aren’t stuck there. You’ve apparently figured this out.

 

I've always known but didn't want to spend that sort of money on something I could not evaluate. Given the 10 day -> 1 month 100% guarantee, I could do that now and let him evaluate it. Given the cost, I'd have t do one at a time until I am 100% happy.

 

Does your buddy sell diamonds? If so, ask him to assist. Starting with a dealer that you are inclined to trust and who has personal expertise in looking at diamonds is definitely worth a drive. You can do a lot with him by email, FexEx and over the phone by the way.

 

He doesn't do that big of a stone really. He found me a 1.5 but I want bigger. He would evaluate it for me and even appraise as he is GIA certified. He is 3 hours north so I could easily fly him down here. :)

 

I know nothing about your friend and certainly don’t mean to pick on him but the term ‘GIA certified’ is a red flag if he’s using it instead of you. GIA is a school and they have gobs of graduates but they don’t ‘certify’ graders. It’s true that many qualified graders have GIA credentials, all GIA graduates are not equally skilled at either grading or communicating their results and MOST don’t have the tools and equipment to do it properly.

 

Nothing wrong with what you said. The only thing I know is that he went to GIA school in Cali for a few years, graduated, and moved back to NY and works at a local jewlery. He said most of his training was to grade stones by eye and under a microscore. He did my girlfriend's diamond stud appraisal. Gave me an incredible deal too.

 

For me, the things that make a stone most attractive are in the category of cutting and the optics and most of these are not included on the lab report. The closest you can come is a summary in the form of the cut grade. For that reason, my first spec would be GIA-excellent or AGS-ideal cutting and would not seriously consider either an alternative lab or a lesser grade. The ‘in person’ question will become one of further selecting from these. Your budget is decidedly low. Do a search at the top of the page titled ‘find online jeweler’ and you can see how the various attributes relate to one another and the price.

 

Seems like most online vendor seem to like EGL as I wonder if its because of their relaxed judging? You think my budget is too low for what I want?

 

Also, seems like the cutting/optics are the things that stand out which makes it easy/hard. Easy as I can find X stones that fit my 4Cs and then I can just narrow down due to the cuts but that fails out of my ability now except looking for the words PREMIUM and IDEAL. :)

 

Given the price as the least flexible attribute, and we’re carving cutting and lab choice in stone, this leaves you with size, clarity and color to adjust. Play with it for a while and see what you come up with.

 

I found this which falls in my price range but from ELG (Source is UnionDiamond/Abazias):

 

UNION 1.72 H VS1 Select Idealâ„¢ $10114

ABAZIAS 1.72 H VS1 Ideal EGL $10,203.90

 

Thank you for help.

Link to comment
Share on other sites

Perhaps I was unclear.

 

My recommendation is to use GIA or AGSL ONLY as the first level grader for clarity, color and weight. Ignore all others.

I recommend using GIA-excellent (or AGS-0) as the first criteria for cut.

 

Use your own eyes and your own expert for additional selection from the above rough categories.

 

I have no clue if your friend considers himself to be expert on topic but I recommend asking him and if he ducks the question of discussing cutting, I suggest you find a different advocate. This is not well taught at GIA and prior to 2006 it wasn’t taught at all by the way.

 

Most jewelry stores don’t carry much inventory at this price point so I’m not surprised that they would need to do it as a special order but it does surprise me that a store would decline to sell a stone over 1.50cts.

 

You are correct that there are lots of dealers who would like to sell you stones graded by other labs that use different scales from the majors. That doesn’t make it in your best interest to agree to it. My advice remains unchanged. Stick with GIA/AGSL grading, stick with the top cut grades and narrow it down from there.

 

Yes, I think your price is too low to get what you want. Something is going to flex although it may not be you that’s doing the flexing. One approach is to find a lab that will describe an I as an H, an SI1 as a VS1, an AGS-4 as a super-premium ideal cut, etc. The same compromises have been made it just wasn’t you who made them and it’s unlikely they were made with your best interests at heart.

 

A bit of research into the differences between the labs would be worth your trouble. There has been quite a bit of discussion in the forum here over this topic.

 

Neither of your suggested stones meets my basic criteria although others here may be interested in commenting on them. It will help if you provide a link to the actual advertisements rather than listing a summary.

 

Neil

Edited by denverappraiser
Link to comment
Share on other sites

Perhaps I was unclear.

 

Probably me not reading properly. :)

 

My recommendation is to use GIA or AGSL ONLY as the grader for clarity, color and weight. Ignore all others.

I recommend using GIA-excellent (or AGS-0) as the first criteria for cut.

 

I agree given my buddy told me that GIA is not as "giving" as the others meaning the consumer gets the best deal.

 

However, most stones seem to be done by EGL?

 

In records to the first criteria for cut, it seems like every 3rd party has their own "cut". It's not easy to know what matches up from grader to grader (ie. ideal vs premium, etc..). Furthermore, doesn't cut get broken down into categories? My EGL stone was "GOOD" for POLISH and SYMETRY but that's all the "CUT" information I have. Which are you referring to?

 

Use your own eyes and your own expert for additional selection from the above rough categories.

 

So basically, compare different stones with the same rough categories to find the one with the best "cut" to my eye? Man, I am not comfortable with that... I like the idea of getting it into the rough categories to eliminate the other variables but I doubt I could make the best choice on the best stone. Even the rough categories is sketchy to me as I am not sure where to sacrafice and add: Go VS2 instead of VS1 to go from Color G instead of H, etc.. I have an idea on the caret/price though. :)

 

I have no clue if your friend considers himself to be expert on topic but I recommend asking him and if he ducks the question of discussing cutting, I suggest you find a different advocate. This is not well taught at GIA and prior to 2006 it wasn’t taught at all by the way.

 

He dumbs it down for me but does talk about the cutting and how light refracts and has used terms such as shallow, depth, table, ideal cut, etc.. Again, we talked briefly.

 

Most jewelry stores don’t carry much inventory at this price point so I’m not surprised that they would need to do it as a special order but it does surprise me that a store would decline to sell a stone over 1.50cts.

 

He said his vendor didn't have a stone that size with my categories? I was surprised myself.

 

You are correct that there are lots of dealers who would like to sell you stones graded by other labs that use different scales from the majors. That doesn’t make it in your best interest to agree to it. My advice remains unchanged. Stick with GIA/AGSL grading, stick with the top cut grades and narrow it down from there.

 

That's fine but it eliminates a lot of stones especially the ones listed by Union/Abazias.

 

 

A bit of research into the differences between the labs would be worth your trouble. There has been quite a bit of discussion in the forum here over this topic.

 

I spent 4 hours last night reading. Still learning. It's overwhelming.

 

Neither of your suggested stones meets my basic criteria although others here may be interested in commenting on them. It will help if you provide a link to the actual advertisements rather than a listing a summary.

 

Neil

 

Thanks for your help. I was psyched I found something but I guess i didn't.

Link to comment
Share on other sites

The problem with 47th street and similar ‘street faire’ type venues is not that there isn’t plenty of competition, it’s that the vast majority of diamond customers who go there are very sporadic in their shopping. People come in, buy a stone and go away and the seller is under a tremendous amount of pressure to say pretty much anything to close the deal. They suffer under the highest taxes, the highest rents and the highest cost of living in the entire country.

 

As you are observing, diamonds are largely a blind item for the majority of consumers and you are incredibly reliant on the seller for accurate information. . This gives them an enormous advantage and the skill that closes sales is fast talking, not truth talking. The most profitable merchandise is what SOUNDS good rather than what actually IS good. Pointing to the labs as causing a diamond to be ‘certified’ and therefore identical is a chimera that bites an enormous number of people and, I must say, you are setting yourself up for it. You’re willing to pay more than $10,000 for a pebble that at least somebody is willing to call an H/VS1 and Ideal with what seems to be little regard to who it is or what criteria they're using.

 

Neil

Link to comment
Share on other sites

Here's an example of a GIA report. The 6th line item is titled 'Cut Grade'. It's right below the clarity. In this case it's 'Excellent'. This appears on all reports issued after 2006 for all round brilliant cut diamonds submitted to them. That's the attribute that I'm talking about.

 

The scale goes:

Excellent

Very Good

Good

Fair

Poor

 

Yes, we're eliminating a lot of stones, and the majority of stones from some dealers. What's wrong with that? You're not trying to buy a lot of stones, you're looking for the ONE that's right, right?

 

Neil

post-109418-1212952644_thumb.jpg

Edited by denverappraiser
Link to comment
Share on other sites

In records to the first criteria for cut, it seems like every 3rd party has their own "cut". It's not easy to know what matches up from grader to grader (ie. ideal vs premium, etc..). Furthermore, doesn't cut get broken down into categories? My EGL stone was "GOOD" for POLISH and SYMETRY but that's all the "CUT" information I have. Which are you referring to?

 

This is correct. There are tons of different approaches to grading cut and it can be confusing as hell but, if you're inclined to take my advice, you need only concern yourself with 2, GIA & AGS. It's worth noting that these are different also but understanding 2 scales is a lot easier than trying to understand all of them.

 

As an Internet shopper where you are choosing a stone unseen, I would not suggest considering one that doesn't provide a cut grade (pre-2006 date) and I would be nervous about an AGS stone dated pre-2005 when they did some major changes in the rules.

 

Polish and Symmetry aren't cut grades, they're finish grades. Yes, there are sub-categories to both cut grading systems but they're different depending on which system you're talking about. GIA doesn't include them on the report at all and AGS includes them only on the little flap on the right margin which often isn't scanned when people post reports online. Unless you're up for a substantial learning curve, frankly I wouldn't worry much about these. :)

 

Neil

Link to comment
Share on other sites

Thank you.

 

Seems like the similiar typed GIA are more expensive probably because they are legit. :)

 

Bingo.

 

You learn fast grasshopper. :)

 

And just to nip it in the bud when you discuss this with someone pushing EGL or similar paper (and you should definitely do that, free Internet advice should ALWAYS be taken with a grain of salt) and they tell you that the problem is how insanely expensive GIA services are, here's the GIA fee structure, straight from the horse's mouth.

 

Neil

Link to comment
Share on other sites

The best way to get an idea of how much diamond you can get for your budget is to use the internet search engines. To get an idea of the right price, I looked at Amazon.com (very good diamond search engine), Blue Nile, Brilliance.com, and a couple of other sites. You are obviously intelligent enough to learn the parameters of a diamond. Learn them all: Cutlet, Girdle, Table, Depth, Crown, Symmetry, Polish, Pavilion Angle, Crown Angle. These criterion don't guarantee a diamond will scintillate but they get you a lot closer to the mark that taking someone else's word for it. There are plenty of internet resources that will give you some good rules of thumb for proportions. Ideal proportions are obviously not uniform from one shape to the next (e.g. a princess shape will have distinctly different cut parameters than a round brilliant).

 

I went to several jewelers and invested several hours researching and ended up buying from an online vendor. This only works if you have the luxury of being price elastic. If you need to get engaged next week you'll pay a lot more than if you have a couple of months to find the right stone. Educating myself, shopping, buying, altering, and finally getting the right ring took me about 10 weeks. I had a difficult time getting the setting right and burned about $75 sending stuff out to be remedied via registered mail. It was a lot of work. Now that I'm done with it, I am enormously pleased with the value I received (I also paid no sales tax which was a 5% discount right off the bat).

 

From my experience, retail jewelers want to sell you their inventory and they usually stock diamonds with good color/clarity ratings that they can sell cheap (because thats what uninformed consumers demand). I didn't feel like I was given "expert" advice. It was more like going to a car dealership. Most just did things like put an "G-SI1" next to a "F-VS2" and talk about why one was better than the other with no regard to certification or cut grade. In some cases, I felt like I knew more about cut than the sales personnel. Had I found a jeweler that could save me all that time for a 15%-20% markup it would have been well worth it to me. I didn't. I hope you do. Regardless, your ability to negotiate this purchase adeptly is going to be directly proportional to your knowledge. If you rely on others (particularly those with a conflict of interest), you are probably going to get suboptimal value.

 

I looked at round brilliants at the brilliance.com search engine and I think you are going to have to spend about $14k (maybe a a bit more) to get yourself a 1.5 ct diamond with great proportions. If you go to a retail outfit, expect to pay 20% more (which is well worth it if you don't have the time to invest in educating yourself thoroughly). For an intelligent person such as yourself, I think you can compensate yourself well by doing some reading and looking at some diamonds from internet vendors. You will notice that non-AGS/GIA certified diamonds tend to be much better "deals" (I had two jewelers say, "why pay for GIA or AGS when you can get the same thing for less"). Don't be fooled. If those jewelers could get a favorable grade from GIA or AGS they would do it in a heartbeat. The fact that they haven't done so should be a big red flag.

 

Some more advice on purchasing a setting: if you buy online, you aren't likely to get artisan craftsmanship. I ordered a split shank setting in platinum; a hard metal to work with in a complicated setting. It looked awful. I moved to a much simpler setting in 18k gold and got much better quality. Again, I had to educate myself about settings so that I knew what to look for and knew what to complain about. In hindsight, I wish I had just purchased the diamond and taken it to a local jeweler to have it set. You pay a premium but its so much less time consuming to correct. The mass customization model a la Dell doesn't translate to rings like it has for computers. If you do buy the setting online, keep it simple (which doesn't necessarily mean cheap or unattractive).

 

I know this is a lot to take in but I've put considerable effort into this and feel I should pay it forward. This site was a big help to me when I was going through the same process.

Edited by mmath
Link to comment
Share on other sites

In records to the first criteria for cut, it seems like every 3rd party has their own "cut". It's not easy to know what matches up from grader to grader (ie. ideal vs premium, etc..). Furthermore, doesn't cut get broken down into categories? My EGL stone was "GOOD" for POLISH and SYMETRY but that's all the "CUT" information I have. Which are you referring to?

 

This is correct. There are tons of different approaches to grading cut and it can be confusing as hell but, if you're inclined to take my advice, you need only concern yourself with 2, GIA & AGS. It's worth noting that these are different also but understanding 2 scales is a lot easier than trying to understand all of them.

 

As an Internet shopper where you are choosing a stone unseen, I would not suggest considering one that doesn't provide a cut grade (pre-2006 date) and I would be nervous about an AGS stone dated pre-2005 when they did some major changes in the rules.

 

Polish and Symmetry aren't cut grades, they're finish grades. Yes, there are sub-categories to both cut grading systems but they're different depending on which system you're talking about. GIA doesn't include them on the report at all and AGS includes them only on the little flap on the right margin which often isn't scanned when people post reports online. Unless you're up for a substantial learning curve, frankly I wouldn't worry much about these. :)

 

Neil

 

From my research, I felt that symmetry was arguably the most important thing to pay attention to after cut. A less-than-perfect symmetry score is often a flag that the cutter left extra weight in the stone to keep it above a certain point value, which almost certainly has a negative impact on light performance. What do you think?

Link to comment
Share on other sites

Since you are considering an online purchase, why not go with a vendor that actually sees the stone and can evaluate it for you without just going by a few numbers from a drop shipper that doesn't see anything. It will save you heaps of time and the prices are about the same.

Edited by jan
Link to comment
Share on other sites

Since you are considering an online purchase, why not go with a vendor that actually sees the stone and can evaluate it for you without just going by a few numbers from a drop shipper that doesn't see anything. It will save you heaps of time and the prices are about the same.

 

 

EDIT: Never mind, I see what you are saying here Jan. This is better than using a drop shipper if and only if the jeweler is truly looking out for the buyers best interests. Otherwise, its just a cheap alternative to a jeweler. Of course, I don't have any experience with this, so you may have a valid point.

 

Most drop shippers have a 30-day unconditional return (all of the above I listed do). So you can actually look at the stone and then, if you don't like it, throw it back and try again. It is a time consuming process but you have far greater selection and none of the opacity of an overpriced, unscrupulous jeweler (again, this probably doesn't describe all retail jewelers, just the ones I've worked with).

 

The argument against drop shipping certainly makes sense. But if you carefully control the parameters of the diamond and stick with GIA-excellent or AGS-Ideal, the probably that you find dud after dud is pretty low (or maybe I just got lucky?).

Edited by mmath
Link to comment
Share on other sites

From my research, I felt that symmetry was arguably the most important thing to pay attention to after cut. A less-than-perfect symmetry score is often a flag that the cutter left extra weight in the stone to keep it above a certain point value, which almost certainly has a negative impact on light performance. What do you think?

 

One of the requirements for GIA-excellent cut is a symmetry of VG or better.

One of the requirements for AGS-Ideal cut is a symmetry of Ideal.

 

Given this, and given the original requirement of ex/id, I think symmetry is already covered. For people who are considering other shapes (GIA only assigns a cut grade on round brilliant cuts) I think the symmetry is a bigger issue but even then I would count it more in terms of a demerit. A symmetry of Good or less is a bad sign but VG or EX isn't necessarily a good one.

 

What's the fifth C? Certification. As in, what lab did the grading? What's the 6th? Cost.

 

Neil

Link to comment
Share on other sites

Some more advice on purchasing a setting: if you buy online, you aren't likely to get artisan craftsmanship. I ordered a split shank setting in platinum; a hard metal to work with in a complicated setting. It looked awful.

that's really painting with too wide a brush.

If an online vendor actually has the merchandise, and has actual photos, there CAN be extremely high quality jewelry work.

 

No question the places that offer diamonds unseen, off a list are also offering workmanship unseen- which certainly can lead to what happened you you.

pband7.JPG

Here's a photo of a custom made ring, with two pink diamond bands that we made recently in our factory for a client.

i'd put this workmanship up against ANY jewelry, anyplace in the world.

Sure, there are places that might be able to equal this quality- but NONE surpass it.

Edited by diamondsbylauren
Link to comment
Share on other sites

Some more advice on purchasing a setting: if you buy online, you aren't likely to get artisan craftsmanship. I ordered a split shank setting in platinum; a hard metal to work with in a complicated setting. It looked awful.

that's really painting with too wide a brush.

If an online vendor actually has the merchandise, and has actual photos, there CAN be extremely high quality jewelry work.

 

No question the places that offer diamonds unseen, off a list are also offering workmanship unseen- which certainly can lead to what happened you you.

Here's a photo of a custom made ring, with two pink diamond bands that we made recently in our factory for a client.

i'd put this workmanship up against ANY jewelry, anyplace in the world.

Sure, there are places that might be able to equal this quality- but NONE surpass it.

 

You are probably right. I honestly have no idea. I do think that my experience is probably typical of the large internet vendors like Blue Nile and Amazon. Drop shippers are competing on the basis of cost. For a commodity (diamonds) this is a good value but they aren't going to give you a premium quality setting.

 

I'm sure there are a lot of online vendors that do high quality work. Again, I'm just sharing my experience. That ring is beautiful!

Link to comment
Share on other sites

This highlights one of the problems of buying things ‘online’. Really there’s no such thing, you’re buying from some merchant who chooses to advertise online but each one is responsible for their own products and their own offers and there are tremendous differences between them. It’s like buying something over the phone and then feeling that the phone company is somehow responsible for what you get. There are top rate jewelers who advertise online as well as some schlock’s and it’s no more fair to call them all poor craftsmen than to say that all local stores are too expensive. Each dealer and each deal should be evaluated on it’s own merits.

 

Neil

Link to comment
Share on other sites

For a commodity (diamonds) this is a good value but they aren't going to give you a premium quality setting.

 

I'm sure there are a lot of online vendors that do high quality work. Again, I'm just sharing my experience. That ring is beautiful!

 

Thank you for the compliment on our rings!!

 

You mentioned the word "commodity"- and that is actually not true about diamonds.

Generally when we speak of commodities, they are fungible. For example, one barrel of crude oil =any other barrel of crude.

Each ounce of 24 karat gold is identical to the next one.

The same can NOT be said for diamonds.

One D Flawless 1.00 can be worth significantly more than another.

Link to comment
Share on other sites

For a commodity (diamonds) this is a good value but they aren't going to give you a premium quality setting.

 

I'm sure there are a lot of online vendors that do high quality work. Again, I'm just sharing my experience. That ring is beautiful!

 

Thank you for the compliment on our rings!!

 

You mentioned the word "commodity"- and that is actually not true about diamonds.

Generally when we speak of commodities, they are fungible. For example, one barrel of crude oil =any other barrel of crude.

Each ounce of 24 karat gold is identical to the next one.

The same can NOT be said for diamonds.

One D Flawless 1.00 can be worth significantly more than another.

 

Diamonds aren't all that rare. Well cut diamonds are rarer than poorly cut diamonds, but neither is scarce. Semantically, you are right: a diamond is not a true commodity because it is not fungible; however, diamonds manifest themselves in the marketplace in essentially the same way. Drop shippers really have just created perfectly competitive exchanges that peddle diamonds similarly to a commodities exchange. This gives the consumer access to the best price competition and the greatest selection.

 

All the market power in the diamond industry rests in the parties that control the mines. The world's supply of diamond is controlled by a strong oligopoly. They choose the quantity that hits the market. Jewelers and middlemen (pardon the sexism) are a weak force in that equation. You are at the mercy of the suppliers and, by extension, so are your customers. In other words, any middleman who claims they have one of a kind inventory is either dishonest or delusional (unless they are doing their own cutting).

 

From my experience, a jeweler can add value to the process by offering expertise. I would gladly have paid someone a price premium to save me that 10 weeks it took me to get a good value. My time isn't worthless. I spun my wheels a lot before I gave up. For this to happen industry wide, my experience has convinced me that there needs to be a realignment of incentives in the industry (the same way CarMax is destroying the old way of selling cars).

Edited by mmath
Link to comment
Share on other sites

mmath-you are making statements as though they are fact- as a consumer, that's kind of misleading.

If you are in the diamond business, you;'d have a far more informed perspective.

 

 

AS much as the drop ship sites would like you to believe diamonds are a commodity they are not.

Having 20 companies listed the same 50,000 diamonds sure makes it look that way- but it's just not the truth.

Many of the best diamonds in any given size, shape or quality are purchased from cutters before they get to the drop ship sites- so in essence much of what you see listed are leftovers. In a large percentage of cases, the drop shipppers get stones that could not sell themselves visually to dealers- and the leftovers are worth less.

 

In terms of who controls the diamond market that is also far more complex.

In fact, retail sellers have a LOT to do with how prices react. If no one is buying something the prices go down.

Marquise diamonds used to command a premium over Pear shapes- but they got less popular, and the prices equalized- based solely on demand.

 

The statement below is surely accurate- you made it as a consumer, and it speaks of your experience buying your diamond.

 

From my experience, a jeweler can add value to the process by offering expertise. I would gladly have paid someone a price premium to save me that 10 weeks it took me to get a good value. My time isn't worthless.

 

But extrapolating global "facts" about the diamond business from such limited experience can be very misleading.

Link to comment
Share on other sites

Last year about this time my family and I took a trip to the Crater of Diamonds in Arkansas. We mined for 12 hours a day and 4 days straight and found nothing as far as a diamond is concerned. I was thinking at the time, anyone that thinks diamonds are a dime a dozen and not rare should come here and see how hard mining can be and how rare they really are. Two hundred and fifty tons of ore must be removed to find a pea sized diamond. I don't think we came anywhere close to that amount without machinery. :)

Link to comment
Share on other sites

Diamonds aren't all that rare. Well cut diamonds are rarer than poorly cut diamonds, but neither is scarce. Semantically, you are right: a diamond is not a true commodity because it is not fungible; however, diamonds manifest themselves in the marketplace in essentially the same way. Drop shippers really have just created perfectly competitive exchanges that peddle diamonds similarly to a commodities exchange. This gives the consumer access to the best price competition and the greatest selection.

 

All the market power in the diamond industry rests in the parties that control the mines. The world's supply of diamond is controlled by a strong oligopoly. They choose the quantity that hits the market. Jewelers and middlemen (pardon the sexism) are a weak force in that equation. You are at the mercy of the suppliers and, by extension, so are your customers. In other words, any middleman who claims they have one of a kind inventory is either dishonest or delusional (unless they are doing their own cutting).

 

From my experience, a jeweler can add value to the process by offering expertise. I would gladly have paid someone a price premium to save me that 10 weeks it took me to get a good value. My time isn't worthless. I spun my wheels a lot before I gave up. For this to happen industry wide, my experience has convinced me that there needs to be a realignment of incentives in the industry (the same way CarMax is destroying the old way of selling cars).

One of the things that has widely spread is a set of appalling misinformation regarding DeBeers, the vast stockpiles of diamonds, the artificiality of the market, etc. High on the list of nonsense is ‘The Diamond Invention’ by Edward Epstein.

 

It’s an interesting combination of a history lesson and a vast conspiracy theory where DeBeers and their advertising agency have manipulated people into buying something quite expensive that they have no real need for in order to further their own nefarious profits. As far as it goes, this is correct. You can’t eat diamonds and there is a valid argument that no one really needs one. The problem, of course, is this applies to pretty much everything we buy. Who needs an ipod? Or a cell phone? Or a steak or lobster when a bowl of rice would do? What about theater tickets or international travel, scuba lessons, imported beer, more than 1 pair of shoes or 98% of the other ways we spend our money. Even the terribly poor seem to have an actual need to buy unnecessary things. To some extend these things can be attributed to modern advertising convincing us that we need these things but there really does seem to be an unspoken human need for this stuff.

 

Diamonds are colossally difficult to produce and they tend to come from what westerners would describe as fairly exotic places. It involves a terribly unusual set of tools and skills to fashion the rocks into the gems that you recognize as diamonds and in the end they are very cool little objects. Are they too expensive when compared to other things? Possibly, but I think probably not. The obscene profits that people seem to believe are in the diamond business don’t seem to be materializing and never really have. In this years Forbes’ list of the 500 richest people in the world, only two could be described as jewelers even in a stretch. Nicky Oppenheimer, CEO of DeBeers who presides over his grandfathers shrinking empire made the list at #173 and Beny Steinmetz at #296 who describes himself as a diamond manufacturer but who got rich dealing in Manhattan real estate more than African rocks. That’s the only two. Diamonds are a $55Billion dollar industry in the US alone, so where’s all that money going?

 

The problem is that diamonds are enormously labor intensive and wickedly competitive at every step. The players, including retail jewelers, aren't nearly as inefficient as you are suggesting. In case you didn’t notice, there are a lot more jewelers than there are, say, railroads or pharmaceutical companies. They spend the money on things like rent, advertising and employees, and those people spend the money on things like heat, printing and still more employees. Even the fairly efficient players like Blue Nile who you're calling 'perfectly competitive' aren’t exactly burning down the house. BN reported an 8% profit on sales in 2007.

 

There was just a big court case over the very issue of whether DeBeers was using their size and power to artificially inflate prices. The court ruled that they had and determined that diamonds were a whopping 4% higher than they would have been without their manipulations.

 

If you were one of the ‘injured parties’ who bought a diamond between 1994 and 2006, you can apply for you’re your share of the refund at https://diamondsclassaction.com/. You may see as much as several dozen dollars for your trouble.

 

Neil

Edited by denverappraiser
Link to comment
Share on other sites

Thank you.

 

Seems like the similiar typed GIA are more expensive probably because they are legit. :)

 

Bingo.

 

You learn fast grasshopper. :)

 

And just to nip it in the bud when you discuss this with someone pushing EGL or similar paper (and you should definitely do that, free Internet advice should ALWAYS be taken with a grain of salt) and they tell you that the problem is how insanely expensive GIA services are, here's the GIA fee structure, straight from the horse's mouth.

 

Neil

 

 

Aside from the online vendors seem to favor EGL, the person I went through said they typically do GIA but absolutely loved this particular diamond even though it was EGL. It was a beautiful stone but I am sure I could do better so I turned it down.

 

The best way to get an idea of how much diamond you can get for your budget is to use the internet search engines. To get an idea of the right price, I looked at Amazon.com (very good diamond search engine), Blue Nile, Brilliance.com, and a couple of other sites. You are obviously intelligent enough to learn the parameters of a diamond. Learn them all: Cutlet, Girdle, Table, Depth, Crown, Symmetry, Polish, Pavilion Angle, Crown Angle. These criterion don't guarantee a diamond will scintillate but they get you a lot closer to the mark that taking someone else's word for it. There are plenty of internet resources that will give you some good rules of thumb for proportions. Ideal proportions are obviously not uniform from one shape to the next (e.g. a princess shape will have distinctly different cut parameters than a round brilliant).

 

I went to several jewelers and invested several hours researching and ended up buying from an online vendor. This only works if you have the luxury of being price elastic. If you need to get engaged next week you'll pay a lot more than if you have a couple of months to find the right stone. Educating myself, shopping, buying, altering, and finally getting the right ring took me about 10 weeks. I had a difficult time getting the setting right and burned about $75 sending stuff out to be remedied via registered mail. It was a lot of work. Now that I'm done with it, I am enormously pleased with the value I received (I also paid no sales tax which was a 5% discount right off the bat).

 

From my experience, retail jewelers want to sell you their inventory and they usually stock diamonds with good color/clarity ratings that they can sell cheap (because thats what uninformed consumers demand). I didn't feel like I was given "expert" advice. It was more like going to a car dealership. Most just did things like put an "G-SI1" next to a "F-VS2" and talk about why one was better than the other with no regard to certification or cut grade. In some cases, I felt like I knew more about cut than the sales personnel. Had I found a jeweler that could save me all that time for a 15%-20% markup it would have been well worth it to me. I didn't. I hope you do. Regardless, your ability to negotiate this purchase adeptly is going to be directly proportional to your knowledge. If you rely on others (particularly those with a conflict of interest), you are probably going to get suboptimal value.

 

I looked at round brilliants at the brilliance.com search engine and I think you are going to have to spend about $14k (maybe a a bit more) to get yourself a 1.5 ct diamond with great proportions. If you go to a retail outfit, expect to pay 20% more (which is well worth it if you don't have the time to invest in educating yourself thoroughly). For an intelligent person such as yourself, I think you can compensate yourself well by doing some reading and looking at some diamonds from internet vendors. You will notice that non-AGS/GIA certified diamonds tend to be much better "deals" (I had two jewelers say, "why pay for GIA or AGS when you can get the same thing for less"). Don't be fooled. If those jewelers could get a favorable grade from GIA or AGS they would do it in a heartbeat. The fact that they haven't done so should be a big red flag.

 

Some more advice on purchasing a setting: if you buy online, you aren't likely to get artisan craftsmanship. I ordered a split shank setting in platinum; a hard metal to work with in a complicated setting. It looked awful. I moved to a much simpler setting in 18k gold and got much better quality. Again, I had to educate myself about settings so that I knew what to look for and knew what to complain about. In hindsight, I wish I had just purchased the diamond and taken it to a local jeweler to have it set. You pay a premium but its so much less time consuming to correct. The mass customization model a la Dell doesn't translate to rings like it has for computers. If you do buy the setting online, keep it simple (which doesn't necessarily mean cheap or unattractive).

 

I know this is a lot to take in but I've put considerable effort into this and feel I should pay it forward. This site was a big help to me when I was going through the same process.

 

Thank you for this well-thought out post. I do have time. Like I said, it has to be perfect. I rarely take the first anything and I have the finances right now so I could do it right now so I am even more inclined to wait and find the exact one. What originally bothered me was I jumped right in and got excited and listened to the Rap Report and how the carat is going up and I should not wait "too long".

 

But, it's worth me figuring out and learning about it. I am glad I didn't take the 4Cs at face value because, to be honest, that's horrible advice which is basically the guidelines for buyers. For me, I do have a GIA buddy (how good, I am not sure but he won't lie to me) and I at least can get myself in the rough categories and then start to worry about the cut. I am starting to see what he told me: Stick to GIA/Get yourself in the 4 categories you want/Worry about the cut The other thing I am worried about is my ability ot distinguish what's good and bad. I think I can get it close and use this forum/my buddy to finalize it. I just don't have the EYE to see what's better.

Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
 Share

×
  • Create New...