How to Buy a Loose Diamond

Last updated on April 24, 2023

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When it comes to purchasing diamond jewelry many people might simply assume that you don’t have much choice when it comes to the diamond set in the piece. Pre-made jewelry is most certainly the norm due to the convenience factor of getting the jewelry straight away.

What a lot of people do not realize, though, is that you can actually buy a diamond loose which you can then have fitted to the setting of your choice. This is a longer process of course but it does allow you to get a more unique and personalized piece of jewelry.

In this article we will show you how to go about buying a loose diamond. We will discuss how to get the best diamond for your money, where to shop for them and how best to get it fitted to a piece of jewelry.

What Are Loose Diamonds?

It is always best to start things by making it clear what exactly you are talking about so what specifically are loose diamonds? Well quite simply they are gem-quality diamonds that have not yet been set into an item of jewelry.

To fully understand the concept of loose diamonds we also must consider the journey they take to creation. When natural diamonds are pulled from the ground they are rough and jagged, a far cry from the beautiful gems they have the potential to become.

It takes a highly skilled diamond cutter to take those rough diamonds and cut them down into a shape that is pleasing. As diamond is the hardest natural material on the planet this is a difficult task which is one of the reasons they are such highly valued gemstones.

Once cut and shaped by expert craftspeople the diamonds are offered for sale on the global market through wholesalers. In turn jewelers will buy the diamonds from these wholesalers and then eventually sell the gems to the general public.

How Is Diamond Value Assessed?

When it comes to determining the value of a diamond experts factor in what is known as the four C’s. This stands for carat, cut, clarity and color which are essentially the main legitimate variables that dealers consider. The four C’s of a diamond are graded by an independent third-party gemology lab. These labs have no skin in the actual trading of the diamonds so they should not have any reason to inflate a diamond's worth.

The top three Gemology Labs in the US are:

• Gemological Institute of America (GIA)
• International Gemological Institute (IGI)
• American Gemological Society (AGS)

Carat

You may have heard of the term carat before when it comes to jewelry often in terms of gold, for example 24 carat gold. But what exactly is meant by the term carat? Well essentially it is a term that is related to weight.

Diamonds are not only very hard but they are also extremely dense due to a close packed crystalline structure. In modern terms a carat in weight is equal to 0.2 grams or roughly the weight of a paperclip.

Using specially designed scales the gemology labs will weigh the diamond once fully cut and prepared to get a result in grams. They then divide the actual weight of the diamond by 0.2 to get the carat weight of the item.

As an example a diamond weighing 0.6 grams would be considered to weigh 3 carats. This would be considered a large diamond compared to what you would ordinarily find in a ring as they tend to range between 1 – 1.9 carats in weight.

The carat weight however is not factored in until all of the other four C’s have been determined as it is only the weight of a finished diamond that matters. Raw diamonds need to be cut and the material removed is often discarded for being of little value.

Obviously the heavier the diamond the more valuable it is due to the fact that large diamonds are rarer. The largest diamond ever found was the Cullinan diamond which was unearthed in South Africa in 1905. The raw diamond weighed 3,106 metric carats and was painstakingly cut into nine large gemstones as well as 97 brilliants and a number of other small unpolished fragments.

Clarity

If you are new to the world of diamonds you may not have heard the term clarity before but this is an important aspect when it comes to determining the value of a diamond. As the name suggests clarity refers to the transparency and purity of an item.

All diamonds have imperfections which are often referred to as inclusions or flaws. They may be specks, areas of cloudiness or signs of feathering. Gemologists will look closely into the body of the diamond looking for these imperfections.

The better the clarity of the diamond the more valuable it is. So if the experts are seeing few imperfections then the value of the gem is going to be higher but the more issues that are visible the more the price will drop.

The diamond clarity scale according to the GIA is as follows:

Color

In general terms for a high quality diamond experts will be looking for what is known as a white diamond. This is a diamond that is as close to completely transparent as possible. Almost all diamonds have at least some coloration if only a little yellowing.

This does not mean that colorful diamonds have no value because in fact they still do. Variations of colors in diamonds are very normal and all will have some value. Colored diamonds are referred to as fancy diamonds and will generally be cheaper.

There is an exception however as fancy blue and fancy red diamonds are both exceptionally rare which makes them more sought after. This is why certain shades of these colors can be very expensive indeed.

According to the GIA there are 23 color grades for white diamonds which are labeled using letters. The grading is as follows:

• D-F: colorless
• G-J: near colorless
• K-M: faint
• N-R: very light
• S-Z: light

Cut

This final C refers to an aspect of the diamond which is in the hands of the person who worked the raw diamond. Now often people confuse this with the specific shape the diamond is cut to such as the princess, cushion or heart cuts. This is not the case when it comes to the value of the piece.

What cut actually refers to is how well the craftsperson did at cutting the diamond into its final shape. In other words, how they took the rough diamond and cut it into the gemstone that is now intended for sale.

When diamonds come out of the mines they look like little rocks still encrusted with the material they were found in. The craftsperson will use the expertise to strike the diamond along planes of cleavage to remove unusable materials and expose the gem.

Experts will judge how well the craftsperson has done in terms of making the diamond proportional, symmetrical and pleasingly shaped. The intent is to maximize the fire, sparkle and brilliance of the gem.

The quality of the cut then is measured by 5 grades which according to the GIA are Poor, Fair. Good, Very Good and Excellent. Quite obviously the better the cut rating the more valuable the diamond will be.

Why Buy Loose Diamonds?

Surely it is so much more convenient to purchase a pre-made quality piece such as a ring, stud earrings or a pendant with a diamond already set in place. Well yes this does save a lot of time and you may be able to find the perfect piece of jewelry for your needs. But what if you want something that is more uniquely your style though?

If you buy a loose diamond rather than a pre-made piece of jewelry you can actually choose the diamond you get. Once a diamond is set into jewelry you will never really get to see it in its own individual glory unless you take it out of the setting.

If you buy a loose diamond you can see it as it is without any obstructions and truly make sure you are getting a beautiful gemstone. You also may save some money by purchasing the diamond separately from a setting. Once you have a loose diamond you can then look for the perfect setting into which you can place it.

The important thing to realize about diamonds is that like snowflakes no two are the same which is fantastic. At a glance diamonds cut in a certain way may resemble others of that style but when you really look there are differences in not only appearance but the way they sparkle.

Although all diamonds are different there is something known as the Rappaport Price Sheet which is a universal pricing guide for these gemstones. It takes into consideration the four C’s to create a set price for the diamonds. Those who deal in diamonds will follow this guide but of course as is the case in business there is always a markup in price.

Where Should You Buy Loose Diamonds?

There are two main sources for purchasing loose diamonds, established diamond wholesalers or online jewelers such as James Allen, Blue Nile or Brilliant earth. Now these wholesalers are usually part of diamond selling districts that can be found in select US cities. The largest such district is in New York City.

You can sometimes buy a diamond and a setting individually at a jeweler's brick-and-mortar store but this would be the most expensive option by far as mark ups can be in excess of 50%. This is why for this article we are going to focus on wholesale dealers and online options.

Diamond Wholesalers

These are few and far between but you can find them in a number of major cities such as Los Angeles, Chicago and Philadelphia. The biggest wholesale diamond district however is in New York city. It is known as the New York City diamond district and it is located on West 47^th Street between 5^th and 6^th Avenues.

It has the largest concentration of wholesale diamond merchants in the US, much larger than the ones found in other cities. They mainly sell to the retail jewelry stores but are often willing to sell to the average Joe off the street as long as their money is real.

This is probably not the most convenient method for buying diamonds unless you happen to live in a city that has a wholesale diamond district. It does give you the chance to get cheaper diamonds but it is a more clinical buying experience so the romance of buying in person is lost.

Online Diamond Jewelers

There are plenty of high quality, well respected online jewelers out there such as James Allen, Blue Nile and Brilliant Earth. They have got online diamond sales down to a fine art and sell thousands daily with countless happy customers to attest to their validity as a dealer.

This is by far the most convenient and potentially cheapest way to buy a diamond as you can do it from the comfort of your couch. You can compare hundreds of diamonds and search based on your specific requirements and your budget.

You can shop without feeling rushed or steered by a salesperson toward certain higher priced options. You do however lose that certain romantic diamond shopping experience because although they have attractive elegant looking websites they don’t have the pomp and circumstance of a physical jewelers store.

Which Is The Best Option?

It all comes down to the experience when it comes to choosing to either go to a wholesale dealer or use an online store. I mean how often in your life will you be hanging around a diamond exchange district? It is a unique experience and offers a glimpse behind the curtain of diamond trading.

A key point in buying loose diamonds is getting to see them. Now obviously if you go to the wholesalers in person you can see and actually hold the diamonds. You will have a time crunch however as these dealers are not like jewelers with their fancy stores they make money on volume so will not spend a lot of time handholding you through a decision process.

At a wholesale market you can shop around but only see a fraction of their inventory. There is just simply not enough time to shop. If you are determined to find the perfect diamond for you then you may want to consider making the purchase online.

On sites like James Allen they offer 3D imaging of all their diamonds which can give you a real sense of the quality. Each one is priced based on its performance in gemology lab testing and will have a grading report from one of the three main labs.

You obviously can't hold the diamonds when shopping online which is a minus but you can literally search through hundreds of thousands of diamonds to find the right one for you. Your search can be narrowed down by using their diamond buying tools.

Where to Get Loose Diamonds Set

If you have purchased your diamond online you can often find a fantastic setting at the same website and have them pair the two together for you before they ship them out. This is the most convenient and frankly the least expensive way to do this.

Alternatively, if you bought the diamond in person at a wholesaler you can sometimes have them set it in a setting from their collection. This will probably be more expensive than online. If the wholesaler does not offer this service however you will have to go to a jeweler.

Jewelers often have a good selection of settings to choose from or may be able to custom make a setting to your own design. Be forewarned this will be expensive but for a truly unique piece with your perfect diamond set into it you would expect to pay the big bucks.

Important Warning

Diamonds are not an investment. This is an important factor to remember when buying loose diamonds or jewelry with diamonds set into it. The value of diamonds unlike things like gold simply does not fluctuate.

The diamond industry is controlled very closely with production being dependent on demand. If diamonds are selling well the industry increases production. If there is a lull in sales they will slow production. This gives a somewhat inflated sense of rarity when it comes to diamonds.

The truth is there are far more diamonds sitting in the earth waiting to be mined and processed than the industry would like you to realize. They keep the price of diamonds stable by controlling the production. As such buying diamonds as an investment is not a smart move.

Often once you buy a diamond you will never get back the same amount you paid for it. This is not a reflection of the diamond losing quality merely that those who deal in diamonds will be looking to make a profit from resale themselves so you are often low-balled.

Final Thoughts

If you are a person who prides themselves on being unique and want your jewelry to match that ethos it is a no brainer to buy a loose diamond and build your own unique piece of jewelry. It does take longer than simply walking into a store and buying a pre-made piece but it creates a piece that is quintessentially you.

Reference Diamond Size Chart

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