| The
Effect of Shape on Diamond Prices
The
shape of a diamond can play an important role in determining
its price. For example, a small, 0.07-carat square diamond
may cost up to 15% more than a round diamond of the same weight,
color, and quality.
On
the other hand, a one-carat round diamond can cost up to 20%
more than a one-carat square diamond of the same color and
quality. To better Fig. 3. understand the effect of shape
on diamond prices, you can refer to the following chart. In
it is
a comparison of the price relationship of round diamonds to
fancy shapes (non-rounds) in three different carat weight
categories. Assume that they are the same color and quality.Carat
Weight
Fancy
Shapes Rounds
Cost compared to rounds Cost compared to fancies
0.00 to 0.14 ct sometimes more sometimes less
0.15 to 0.29 ct similar similar
0.30 ct + usually less, except for usually more marquise shapes,
which can cost the same or more
Perhaps you are wondering why round and fancy-shape diamonds
are priced differently. There are a variety of reasons. Small
rounds are sometimes priced lower than fancy shapes because
of lower inventory and labor costs.
(The
additional labor cost of small fancies is partially due to
the specialized skills needed to cut them). Small rounds sell
more quickly so less of a profit margin is needed to cover
the cost of keeping them in inventory.
It's
less time consuming to cut, measure, and select small rounds
than small fancy shapes. Consequently, labor costs can be
lower. During 1990 and 1991, however, the price differential
between small round and fancy-shape diamonds decreased--to
the point where both were often priced about the same.
The
higher cost of round diamonds 1/4 carat and up is the result
of a limited supply and a large demand. Inventory costs for
rounds can be just as high as for fancy shapes because there
are fewer buyers in the market for larger, more expensive
diamonds.
The
shape of a rough diamond crystal before it is cut also plays
a role in diamond pricing. When long diamond crystals are
cut into ovals, pears, and emerald cuts, they weigh more than
if they had been cut into rounds. This means the per carat
cost of the fancy shape can be lower than a round and still
bring the same amount of profit from the original rough diamond.
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