It is important to begin this diamond tutorial with the statement that Lambert does not bear a grudge against D, flawless grade diamonds.
The purpose of this diamond buying outline is to help make the consumer an informed buyer. To make informed buying decisions you will need to delve below the surface of the diamond industry’s technical definition of color and clarity grades. When you know the practical aspects of the visual difference between color and clarity grades over a range of grades, and the price differences, you will have the knowledge that will allow you to save a lot of money, if you choose to do so. You will also need to know about the industry’s pricing system and (“magic number” price jumps).
You will also discover the importance of the cut quality/cut grade and how this will determine the appearance of your diamond while selecting an E color, VVS1 stone over a G color, VVS2, for example, will not effect the appearance of the diamond (to the unaided eye).
• Wholesale vs. Retail
As in many businesses, the diamond business has different levels of distribution. A diamond ring, in a retail outlet, is normally at the top of the distribution chain. The price for the diamond, in this ring, will incorporate the sum total of all the costs and profits in the distribution chain.
Additionally, retailers normally have between a 100% and 300% (depending on the retailer/brand) markup on their cost of product. Special brands command the highest markups. If you can access a lower level of the distribution chain, your savings can be quite large.
• Buy a loose stone and then buy the setting.
• Costly stones should have a certificate from a recognized lab. Certificate stones will have a slightly higher price per carat, but if it’s a costly stone, this is recommended. The certificate will not only provide color and clarity grades but will also include cutting, symmetry and polish grades and degree of fluorescence.
• Don’t mismatch color and clarity grades. For example, D, VS2 is a mismatch. Diamonds with mismatched color-clarity grades are usually harder to sell.
• Be aware of the magic number pricing system
A round brilliant 1.5 ct. HVS2 stone can cost as much as $2,912 more than a 1.49 carat stone, yet they appear to be the same size. There are sharp price per carat jumps around milestone carat weights due to a higher demand for diamonds weighing a little more than a milestone than for those weighing just a little less.
You might call this consumer psychology.
• Have a look at the Rapaport Diamond Report. If the diamond seller will let you see his Rapaport Report, you can see the magic number (milestone) price per carat break points for all the carat size categories (and qualities within the size categories).
• Be aware of standard accepted color grading error: A plus (+) or minus (–) one color grade difference, between the industry “recognized” diamond grading labs, is accepted. A diamond can be an E, F or G at three different labs and each will be “correct”.
• Pay a lot of attention to cutting quality/grade. This has a big impact on a diamond’s brilliance. A poorly cut diamond will look dull and lifeless.
“Ideal” cuts can command a 10%, or considerably more, premium.
Get information on cut parameters/grades that are not “Ideal” but still give high
brilliance.
The Gemological Institute of America (GIA) completed a large scale study which
determined that while Ideal cut diamonds display a large degree of brilliance,
there are non-Ideal cut stones with differing combinations of proportions that
display as much or more brilliance than some Ideal cut stones.
• Be aware that the unaided eye will not be able to see the difference between the higher color and clarity grades and the lower color and clarity grades within a fairly broad range of grades. If you select a G or H, VS1 or VS2 (instead of an F, VVS1 or 2, for example), you can bank the savings or apply the savings to buying a larger stone.
• Branded stones are sold at a premium price
• For expensive stones consider a 6 prong setting
• If you leave your diamond with a jeweler, bring a copy of the lab certificate and verify the jeweler’s agreement that your stone agrees with the certificate.
DIAMOND GRADING:
There are three major non-profit gemological associations which grade and issue reports on diamonds: GIA, AGS and HRD.
There are other well known and recognized grading labs (e.g., IGI, EGL and others).
Color grading must be done with a master stone set of diamonds to compare the diamond being tested to, as without a master set for comparison, it is not possible to see the difference between a wide range of grades (D through H, for most people). Even with the master stone comparison set, there can be a variation in color interpretation by expert diamond graders.
Color Grades: Colorless: D, E, F Near Colorless: G, H, I, J D through H grades are sometimes referred to as “whites”. An I grade stone is considered a slightly tinted white and will look “white” in a setting. need a master set of diamonds (of known color grade) to grade color of a diamond, yet there is a big difference in price per carat between the different color grades. International Standard Error Allowance (plus or minus one grade, accepted as correct)
There is a big difference in price in price per carat between the different color grades.
Clarity Grade:
The degree to which inclusions (flaws inside stone) are visible with 10X magnification.
Out of a total of 11 clarity grades, the difference between the first 7 grades is not detectable without magnification and inclusions in the 8th grade may be visible through the pavilion with the unaided eye.
There is data available that indicates that the first 8 clarity grades exhibit no detectable effect on diamond stones brilliance (all other things being equal).
There is a big difference in price per carat between the different clarity grades.
Clarity Grading (10x magnification):
location of inclusions size of inclusions color of inclusions number of inclusions overall clarity grade
Clarity Grades: F, IF, VVS1, VVS2, VS1, VS2, SI1, SI2, I1, I2, I3 need 10x magnification too see difference Big Price Jump Between Grades
Cutting Grade:
GIA’s new reports now come with a single comprehensive cut grade that is based on a number of criteria which requires “the input of the following proportions: total depth, table size, crown angle, pavilion angle, star length, lower-half (lower-girdle facet) length, girdle thickness, and culet size, as well as the diamond's polish and symmetry grades”.
Older GIA reports and a number of other laboratories report a cut grade as separate from the polish and symmetry grades. In these reports, the polish and symmetry is reported under the heading “Finish” (GIA).
Cut Grades:
GIA Lab: Excellent, Very Good, Good, Fair, Poor.
AGS Lab: Ideal, Excellent, Very Good, Fair, Poor
HRD Lab: Excellent, Very Good, Good, Fair, Poor
There are other well known and recognized grading labs (e.g., IGI, EGL and others).
The cutting quality/grade of a diamond has a major impact on brilliance (the return of
light that enters the stone) and dispersion (“fire”- spectral colors).
Poor symmetry will detract from scintillation (flashes of light off facets as stone is
moved) and poor polish will reduce a diamonds brilliance.
One can find equally brilliant and beautiful diamonds in the Ideal cut and non- Ideal cut ranges. A good cut reflects most light that enters a stone and is usually much less expensive than a very good cut. A very good cut reflects almost as much light as an Ideal cut, but is usually lower in price.
There are also grades for polish and symmetry. The GIA, IGI and EGL labs use the following symmetry grades: Excellent, very good, good, fair, poor, very poor, extremely poor.
Symmetry refers to the degree of proper arrangement/alignment and shape of facets and includes the girdle shape (round-out of round) and straightness (wavy is bad).
Poor symmetry will detract from scintillation (flashes of light off facets as stone is
moved). Your diamond selection should have a symmetry grade of good or above.
Polish will affect the amount of light that enters and exits a diamond. Diamonds that have a poor or lower polish grade have less brilliance. Your diamond selection should have a polish grade of good or above.
A diamond with a cut grade of very good or good and symmetry and polish grades of very good or good can offer the best value in a brilliant diamond.
Fluorescence:
Diamonds with a fluorescence rating of higher than medium should be avoided.
Diamonds with high fluorescence tend to appear slightly milky in sunlight.
Colorless: D, E, F 
Clarity Grading (10x magnification):