"When is the best time of year to buy a diamond?"

This question was recently posed to the ASK NYPL virtual reference service of The New York Public Library. First, if you're looking for a diamond whose size is a half carat or larger, make sure your jeweler offers you a grading report from one of the reputable diamond-grading labs below. To properly evaluate these reports, you must understand the four "C's" of diamonds: carat weight, cut, color and clarity.

The carat weight measures the mass of a diamond. One carat is defined as 200 milligrams. The "cut" of the diamond does not refer to its shape (pear, oval), but the symmetry, proportioning and polish of a diamond and the effect this has on a diamond's brilliance. The best "color" for a diamond (with rare exceptions) is one that is totally colorless — which is graded as "D." A diamond with a very slight yellow color is rated as: "E-F." Little traces of yellow grade as "G-H." Slightly yellow diamonds are "I-K." Clarity is a measure of internal defects of a diamond called "inclusions" (crystals of a foreign material or tiny cracks or blemishes.) The range includes VVSI-2 (Very, Very Slightly Included), VSI-2, SI1 (Slightly Included) and I1, 2, 3 (Imperfect to naked eye.)

Finally, if you wish to avoid purchasing the estimated 1-3% of diamonds known as "conflict diamonds" or "blood diamonds" ask for assurances from your retailer that the diamond is certified by the Kimberley Process Certification System as not having been mined in a war zone and then traded to support arms trafficking (primarily in Africa). Global Witness no longer participates in the Kimberley Process as it views its safeguards as inadequate. They suggest you ask these questions.

The Smaller Diamond

The "best time of year" to purchase a diamond actually depends a great deal on the size of the diamond that you want. Diamonds are generally marketed to consumers in two sizes: "Small" diamonds - 1/2 carat or less - and "Large" diamonds of one or more carats. As to small diamonds, the time period between Thanksgiving and the New Year is a good time to buy because many different retailers of all different sizes compete against one another to sell diamonds of this size to consumers. Also, both the smaller and larger diamonds are quite often the subject of price cuts in the week after Christmas, as all retailers try to reduce the value of their end of year inventory for tax reasons. And diamonds reduce the value of a retailer's inventory more sharply than other goods.

The Larger Diamond

The best time to obtain a good deal on larger diamonds is often the summer (particularly in July and August.) This is because the best times for retailers to "move" diamonds (especially large ones) include the Holiday Season (especially before Christmas), Valentine's Day (second best time for diamond retailers after Christmas), April - June (primarily due to the timing of weddings). However, the most difficult time for retailers is the summer — which is when a consumer would certainly do best on the price for a large diamond or a small diamond.

The Size Factor

Men, who most often purchase diamond engagement and wedding rings, drive up the cost of diamonds as they seek to display status (and signal their desirability as grooms) by purchasing diamonds that are of a certain, defined size. As one econometric analysis found: "people are willing to pay premiums upward of 18% for a diamond that is one-half carat rather than [just] slightly less than a half carat and between 5% and 10% for a one-carat rather than a slightly less than one-carat stone." In other words, you might be able to obtain a diamond that was better in three of the four "C's" of diamond buying: "cut, clarity and color" just by forsaking a very tiny amount of "carat."

Diamonds Cost Less From Reputable Internet Dealers, or Consider "Cultured Diamonds"

You can save up to 20% on the cost of either a small or a large diamond by purchasing it from a reputable online retailer of diamonds. It is much cheaper to purchase and store diamonds in a safe or other secure location than to pay for prime urban real estate or retail space at an upscale suburban mall. Also, synthetic diamonds (often marketed by retailers as "cultured" diamonds) can now be designed by computers so perfectly that even the most trained eyes have difficulty discerning them from real diamonds. And they cost between 15%-60% less than natural diamonds.

References:

• How to Buy a Diamond by Fred Cuellar
• Laboratories that grade diamonds:
  • American Gem Society
  • European Gemological Laboratory
  • Gemological Institute of America
• International Gemological Institute
• Global Witness – Questions about Conflict Diamonds
• Kimberley Process
• The Rapaport Price Lists (fee based) that are relied on by most diamond retailers for pricing
• Log in to our databases to access:
  • Scott, Frank and Yelowitz, Aaron. "Pricing Anomalies in the Market for Diamonds: Evidence of Conformist Behavior." Economic Inquiry Vol. 48 Issue 2, p353-368 (April, 2010)
  • "Buying Jewelry? Don't Get Bling-Boozled." Consumer Reports 72.6 (2007): 6.