The weight of diamonds is measured in metric carats, with 1 carat of diamond weighing just 0.2 grams. Compared to their high value, diamonds are relatively small and light — one of the many reasons they are so popular as an investment.
In this article, we will explore 1-carat diamonds to give you an idea of their price and value as an investment. We will cover:
The popularity of 1-carat diamonds is mainly psychological — put simply, people like round numbers. Moreover, 1 carat is the magic limit where there is no zero before the decimal point. Therefore, round cut diamonds, called brilliants, with 1 carat are a very common choice for classic solitaire engagement rings. Understandably, what woman wants to tell her friends that her engagement ring is 0.93 carats? On the other hand, it matters little whether the diamond weighs in at 1.00 carats or is just over that at 1.09 carats.
To the naked eye, a diamond of 0.91 carats cannot be distinguished from a diamond with 1.02 carats. As a general rule, without taking into account the proportions and depth of the diamond, it can be said that 0.25 carat difference in weight is about half a millimetre in width. Thus, a 1.5 carat diamond is only one millimetre wider than a diamond weighing 1 carat.
Nevertheless, 1-carat diamonds are so popular that diamond cutters, who turn rough diamonds into polished stones, do everything they can to ensure that diamonds that are on the borderline around 1 carat are never cut below 1 carat. The reason is the value. Due to high demand, the price difference between a 0.95 carat and 1.00 carat diamond is much higher than, for example, the difference between a 1.30 carat and 1.40 carat diamond.
Objectively, does the fixation on round numbers in carat weight make sense? Not necessarily, but just like in the stock market, the market is always right. So, it is wise to take into consideration the psychological aspects when investing in diamonds.
With that in mind, most experts recommend that buyers avoid investing in diamonds that are less than one carat.
The price of diamonds is defined by the 4Cs: Carat, Colour, Clarity and Cut. The weight in carats is one of four factors that are used to determine the value of a diamond, but without knowledge of the other three, it is not very meaningful.
A concrete example: a diamond with 1.00 carat that just about falls within the "investment range" (i.e. it is of a high enough quality to be bought as an investment diamond) currently costs around €5,000 (1 ct, colour G, clarity VS1, cut VG, certificate GIA, without fluorescence). A diamond weighing 1 carat, also certified by GIA, in its highest quality (1 ct, colour D, clarity FL/IF, cut 3EX, without fluorescence) is at least €13,000 — without VAT.
The price differences are even more extreme if diamonds that are not of investment quality are also used as a comparison. Thus, 1 carat diamonds with strongly visible inclusions, which are clearly visible to the naked eye (I2-3/P2-3), a stronger yellow tint (K-Z) and only a good cut, are traded for a few hundred euros.
The question "What does a one-carat diamond cost?" cannot be answered simply. If you want to compare the prices of diamonds from different suppliers, you should always choose stones that have exactly the same 4Cs if possible. Only then is the comparison representative.
The shape of the cut also plays a role in the selling price, regardless of its quality. Round brilliant diamonds are always slightly more expensive than more exotic cut shapes, all other things being equal. Not because a different cut shape is worse or less beautiful per se; the demand is simply much higher for brilliant diamonds than for square shapes, for example.
With diamonds as an investment: the rarer and the higher the demand, the more valuable and the higher the chances of an excellent return over a longer investment period. On the other hand, the liquidity also decreases with increasing value. Selling a diamond worth €250,000 takes more time and effort than selling a diamond for €15,000. This is due to the fact that the circle of interested parties who can raise this sum of money is much smaller.
In case of doubt, several diamonds, from 1 carat in weight, are a better investment than putting all your money on a single stone. As the saying goes, don’t put all your eggs in one basket.
