Understanding Point Breaks in Diamond Pricing

If you’re in jewelry sales, it’s not important for you to be a surfer or know what a point break is in the surfing world.

You don’t need to understand that point breaks can form the type of waves surfers love riding.

On the other hand, you do need to understand, and to appreciate, point breaks as they apply to diamond pricing.

Doing so will help you help your customers ride the rough waters of high diamond prices and get the best deal they possibly can.

Whatever the reasons may be, massive price differences often separate miniscule differences in the size, color, and clarity of diamonds. These are the “point breaks” you can ride to sales success.

For instance, focusing on highly popular colors, clarities, and sizes (in terms of wholesale prices as of mid-2012): An F VS1 stone, .90 –.99 ct. wt., was listed as going for $6,755 per ct.

The same size and color stone, but in SI1 clarity, was listed at $5,558 per ct., a difference in price of $1,197, which is a difference of 17.7 %. Meanwhile, the same size and color stone, but in an I1 clarity, was listed at $3,420 per ct.

Great to the Naked Eyed

When you consider that, for example, your typical SI1 stone looks nothing less than perfect –- and that even many I1s look great to the naked eye – you see the importance of these clarity point breaks in a .90 -.99 stone.

Now, for a moment, let’s consider the color point breaks within this same size stone. For brevity’s sake, we’ll look only at the breaks in the SI1 clarity grade. An F color stone is listed at $,5,558 per ct.; an H stone at $4,703; and a J stone at $3,762. Only you and your customer can decide if the value of high color is worth the high cost.

Now, let’s move on to significant point breaks around size. Remember, it would take someone with Superman’s eyesight to actually see the size difference between a .99 ct. stone and 1.00 ct. stone. And yet, all other factors being equal, the cost difference is usually huge.

For example, while a .99 ct. H SI1 stone was listed at $4,703 per ct., the same stone at 1.00 ct. would cost $6,555 per ct. That’s a difference in per ct. cost., for one utterly imperceptible ct., of $1,852. That’s a cost difference of 28%.

Taking this all one step further down in size, the point breaks become even more extreme. For instance, the same .99 F SI1 stone mentioned above at $5,558 per ct. is listed at $3,563 when the size is dropped to .89 per ct.

A Drop in Cost of Nearly $2,000

Consider: the average diameter of a .99 – 1 ct. stone is 6.4 mm. and the average diameter of .89 stone is 6.1 mm. This means that the absolutely invisible difference of .3 mm brings with it, in this case, a drop in cost of nearly $2,000.

One way to look at the above numbers: the 5% difference in diameter between a 1 ct. stone and .89 ct. stone can create a difference in cost of nearly 50%!

The importance of these various point breaks is quite clear. Take the time to familiarize yourself with them so that you can follow them in the various diamond price listings you’ll find online.

After all, in an online age, it’s your jewelry and diamond knowledge –- along with your personal appeal — that will set you apart. Help you help your customer. And help you surf your way to sunshine and success.