Example Diamond Price Calculation

A Standard Brilliant srbsmall.gif (1175 bytes) diamond has the following characteristics:

A base price table for an ideal Standard Brilliant cut diamond of this color and clarity indicates a (hypothetical) price of $5,000/carat.

    If this were a perfectly cut stone, the base price table indicates this 1 carat diamond should cost $5,000.  But...... the table of this gemstone is quite large and the depth quite shallow.  If this stone were recut to ideal proportions what would it then weigh?   The example table indicates a Standard Brilliant cut diamond would (hypothetically) lose 22% of it's weight if it were recut to the proper depth %, and an additional 6% of it's weight for a proper table %, for a total weight loss upon recutting of 28%.

    The "corrected weight" of this 1 carat diamond is thus 0.72 carats [= (100%-28%) x 1 ct].

    Going back to a base price table, we find that a 0.72 carat, G, VS2 diamond should (hypothetically) cost $3800/carat.

    The (hypothetical) price of this diamond, when account is made of cutting imperfections, is therefore 0.72 x $3800 = $2736.

    Notice that this price is not simply 28% less than that of a perfectly cut 1 carat diamond of the same color and clarity grade (i.e. $3,600) but is, instead, about 45% less.  This results from the fact that prices per carat are always less for lighter stones, all other factors being equal.

    It is also worth stating again that base price tables contain "asking prices".  These are nothing more than wholesale price guidelines; actual costs may be less.  Prices used in this example and the deductions for cutting imperfections are purely hypothetical.

Updated 08/19/09
Comments and questions to helper@mail.utexas.edu
Department of Geological Sciences
The University of Texas at Austin