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Would Like To Know The Value Of This Stone.


Edward Kagan
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Hello,

 

I have the following GIA-certified princess diamond:

 

Carat Weight: 2.09 carat

Color Grade: G

Clarity Grade: VS2

Measurements: 7.12 x 6.82 x 4.99 mm

Polish: Very Good

Symmetry: Good

Fluorescence: None

Table: 72%

Depth: 73.2%

Culet: None

Girdle: thin - thick

 

I would like to know what a dealer would sell this diamond for and what a dealer would buy this diamond for.  Also, if possible what the Rap sheet value is.

 

Help is greatly appreciated!

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Good evening Edward,

 

You can get a pretty good idea what dealers are charging by looking for similar stones by looking in the 'diamond finder 'link at the top of the page.  It's free and anonymous.

 

Here's the offerings for 2.0-2.09/G/VS2/princess cuts.

http://www.diamondreview.com/diamonds/?sortOrder=carat&sortDesc=0&fShape=Prin&fCaratLo=2.00&fCaratHi=2.09&fColorLo=G&fColorHi=G&fClarityLo=VS2&fClarityHi=VS2&fCutLo=&fCutHi=poor&fDepthLo=50.0&fDepthHi=80.0&fTableLo=40.0&fTableHi=80.0&fSymLo=&fSymHi=poor&fPolLo=&fPolHi=poor&fCulLo=&fCulHi=vlarge&fFlrLo=&fFlrHi=vstrong&fPriceLo=0&fPriceHi=1000000&fLabGIA=1

 

Dealers don't all pay the same and offers will vary depending on details like their inventory levels, what they think of the cutting, cash flow, what sorts of stones are doing well for them at the moment and other variables.  Most are happy to give bids for free.  Ask.  Typical cash offers are about half to 3/4 of what they're going to be selling it for. 

 

Rap is a subscription service.  Details are at www.diamonds.net.

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Thank you for the reply.  

 

The prices in the diamond search, are they more of a retail range or jewelers would pay these prices if they were say to look for a particular stone for their customer?

 

As to the Rap, sorry for not phrasing the question better.  I know what Rap sheet is, I was hoping you could tell me what the Rap value of this particular stone is.

 

Thanks again!

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There is no such thing as "rap value" of a particular stone (and particularly of a fancy cut). That's why it's a completely irrelevant piece of information for someone buying a single diamond, whether as a consumer or as a reseller - there are other reasons why it's irrelevant too, not least the fact that Rap prices are supposedly wholesale ask prices (and the problem isn't "wholesale"; it's "ask" - I can ask a million bucks for my empty beer can; doesn't mean I get it, wholesale or retail). You can get a reasonable idea of what the wholesale-to-retail margins for diamonds are on average by looking at Blue Nile's accounts; last time I looked, their gross margin was a shade below 20%, and it includes items that have significantly higher margins such as settings and finished pieces (rings, stud earrings, bracelets etc.).

 

Prices in the Diamond Finder are prices you as a consumer would pay at fairly commercially aggressive internet retailers. I'm not sure if I understand the second part of your question: "or jewelers would pay these prices if they were say to look for a particular stone for their customer?" - the price a jeweller would pay would depend on a lot of things: who is selling to them (consumer, another dealer for a one-off sale, a wholesaler with whom I deal regularly since a long time), on what T&C (credit terms, sale-or-return, straight cash upfront, part-exchange/barter) and for what item (a 3 carat K/SI2 marquise is going to be much more difficult to resell than a 0.70 G/VS1 superideal round).

Edited by davidelevi
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It's not at all clear to me what you're asking and I think you are expecting a pricing mechanism that doesn't exist.  Are you considering buying this stone, selling it, consigning it to a jeweler or something else entirely?  Did you already buy it and are now second guessing your decision?  Yes, it makes a difference.

 

The usual way diamonds get sold through jewelers these days is a consignment on demand mechanism called 'memo'.  The jeweler doesn't actually buy the stone, they're collecting a commission for selling it on behalf of someone else.  All they have on the front end is the data.  These commissions range anywhere from under 10% to 30% or more depending on the nature of the store.  Not everyone charges the same for their time and talents.  The diamond finder guys tend to be on the low end but the real reason for pointing people there on questions like this is that the data is easy.  There are thousands of stones for sale and they really are serious.  For the most part they really would result in a deal if you went through the process and even with negotiation the final price would be within a few hundred dollars of where it started.  Most stores are nowhere near this transparent.

 

Even with that, you'll notice from my link above that prices range by more than a factor of 2 on superficially similar goods.  This even from the same dealers.  Why?  Most of this has to do with cutting and grading standards and a few might just be errors but there's a definite competitive component.  Some seller has a stone they want to move and they priced it lower to attract bargain hunters.  This is where the trouble comes in declaring a 'value' like you've asked.  That's why Rap is a trap.   Any statement of value must contain an element of what it's worth to whom, when, and under what circumstances.  It's just an opinion anyway and it needs to be understood for what it is, but without that it's an opinion out of context and has no merit at all.  The answer to life, the universe and everything is 42.  The trick is in understanding the question.

Edited by denverappraiser
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Thanks guys,

 

I guess you're right, I'm looking for answers to wrong questions.  I am a software engineer by trade and as such I am better at understanding scientifically organized and processed data.  Seems that when it comes to diamonds there is no single pricing structure and pricing can be very volatile.

 

Basically I am trying to sell this stone and want to figure out the best way to go about it, main objective naturally being maximum return.  I am not in a hurry, I am in no way desperate or hurting for money, so I am trying to do my research and find the best way to proceed. 

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There are 3 basic sales paths. Direct to consumer, sale to a dealer, and consignment through a dealer.

 

Direct sale generally produces the most money and is both the most work and the highest risk. That means friends of friends, coworkers, craigslist, ebay and so on. As a rule, ask about 3/4 of what you think comparable goods cost at the discount dealers.

 

Sales to dealers is a matter of collecting bids on things. This path is usually the fastest. Again, expect about half to 3/4 of the selling price of comps although expect them to choose different comps than you will.

 

Consignment through a dealer is, frankly, likely to be the best in this case. They try to get as much as they can and then collect a commission on the deal. Consignment strategies vary a bit and costs range from about 10% to about 30% depending on how you want things marketed. Personally, I would consign it to a 'real' jewelry store and pay a little extra because they can usually get higher prices. Be aware that consignments can be slow. It may sell in a week, but it may take a year.

 

It may be necessary to update your GIA by the way. You didn't mention the date but consumers tend to hold the date against you if it's more than a couple of years and against a dealer if it's more than a year.

 

Have you spoken to an appraiser about this yet? It might be helpful.

 

Just out of curiosity, why did you ask about Rap?

Edited by denverappraiser
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One more note about consignment: choose your consignor carefully; since they won't be bidding for your stone, the highest "price" with the lowest commission may well be the one that doesn't sell but keeps your stone tied up for months or even years. By any means don't be aggressive with discounts if you are not in a hurry to sell, but be realistic - and make sure that your chosen partner does sell that type of thing (observe their current stock and see how quickly things move, if you have a few weeks to spare...).

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Thanks guys, all great advice.  I have an appointment tomorrow with a Jewelry Judge appraiser Joel Lackey here in Vegas.  I figured having an appraisal probably won't hurt if I choose to go the "direct to consumer" route.

 

I'm surprised that a GIA cert that is a couple of years old is outdated.  The stone doesn't change over the years, so why would you need to get a new cert?   And if that's the case, why etch the report number on the stone when over the life of the diamond it may be regraded multiple times?

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Take it up with your appraiser. The reason people are worried about older stones from dealers is because they fear 'dead stock'. Stones that have been sitting around for a while must have problems (they think). From consumers, the worry is about possible damage. A new inspection adds confidence. Whether or not you need it is going to depend on your marketing plan. The inscription has nothing to do with it. If you're selling to a dealer, I wouldn't do it, if you're selling to a consumer I probably would. It's more like the reason realtors want to paint everything beige. It avoids questions and takes away one of the things that buyers worry about.

 

If it's got an inscription, GIA will reuse the same number so there's only one inscription on the stone.

Edited by denverappraiser
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The reason why people are wary of old reports is that even if diamonds are very hard and resilient they aren't exempt from damage: chips, nicks and scratches can and do happen, and they have a significant impact on clarity, finish and price (particularly for high clarity diamonds - which is not the case here - or diamonds with sharp corners - which is the case). A recent report provides greater reassurance that clarity and finish are correctly stated (though of course it's not a guarantee).

 

I think you can ask GIA for a "reinspection", in which case the report number won't change (and the fees are slightly lower IIRC), but in any case the reasoning behind the laser inscription is that very few diamonds are actually resold... and it makes people feel that the diamond is more secure against impromptu switching or facilitates ID (in my opinion it does neither of those things well, but never mind). Incidentally, removing the inscription is quite easy and very quick.

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Don't you just love it when Davide and I say the same thing in different ways?

 

The reinspection discount only applies for a very short time, I think 6 months. They'll stll use the same number if you send back the original report but the fee is the same. (They're very concerned about having non-identical reports with the same number so they're pissy about returning the original document)

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Not silly questions at all.

 

Thinking of your conversation with the appraiser tomorrow, if I were to point out one thing, it is this statement by Neil:

Any statement of value must contain an element of what it's worth to whom, when, and under what circumstances. It's just an opinion anyway and it needs to be understood for what it is, but without that it's an opinion out of context and has no merit at all. The answer to life, the universe and everything is 42. The trick is in understanding the question.

Bear in mind that many appraisers will assume that you want an appraisal for insuring the stone, since that's by far the most common reason for seeking their services. You aren't looking for that (at least, I believe you aren't!) - make sure the appraiser understands what your question is.

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