Do the 4Cs Still Make the Cut?

RAPAPORT... The "5Cs and 2Ts" isn't as catchy as the usual formula, but it might be a better pricing method, according to the author of a diamond-trade guide that claims the 4Cs are no longer adequate."One of the biggest misconceptions is that there are onlyfour diamond price factors - color, clarity, cut and carat weight," Ren?(C)eNewman, a graduate gemologist who last year published the third edition of her DiamondHandbook, says in an interview with Rapaport News. "In fact, thereare other factors, such as the transparency and treatment status. They can havea large impact on price. We [in the trade] may know that, but the consumersdon't, because they just hear about the 4Cs." Transparency mattersThe Gemological Institute of America (GIA) developed the 4Csin the 1950s, when the industry considered cloudy diamonds to be industrialquality and didn't put them into jewelry, the Handbook explains. Today,jewelers do use cloudy and hazy diamonds, but their clarity grades often don'treflect their lower transparency, even though that characteristic can affect the value. Newman distinguishes between clarity - a stone's lack ofinclusions and other blemishes - and the first "T," transparency, which is howwell it lets light pass. While a diamond with high clarity will have few or noinclusions, a stone is transparent if a viewer can see objects through itdistinctly. Many laboratories don't take into account subtle differences intransparency, Newman writes. "I've seen hazy and slightly cloudy diamonds withVS clarity grades," she notes in the book. How to treat treatmentsVery few treated diamonds were on the market when the 4Cscame along, Newman explains. Most diamonds are still untreated now, but it'sbecoming a larger minority as sellers seek to improve stones' color, clarityand transparency. This second "T" is important, as it hugely impacts theprice. An untreated 1-carat, fancy-green, VS-clarity diamond will often fetchmore than $200,000, compared with around $5,000 for an irradiated diamond withotherwise identical characteristics, Newman estimates. Treated diamonds arealso much harder to resell. A fifth "C" - and a sixth? The "cut" part of the 4Cs needs to be two separatecategories, she argues. In the 1950s, the trade didn't differentiate betweenthe shape and the quality of the cut when deciding prices, so it didn't matterthat the same term referred to both things. Now, the cutting style and shapeare a distinct price factor from cut quality, with many labs providing a gradefor the latter, she observes. Meanwhile, rising interest in lab-grown diamonds hasprompted Newman to consider an eighth criterion for a revised edition of one ofher other books aimed at consumers. "I left out a 'C' that I'm going to add when I redo my DiamondRing Buying Guide, and that is the creator. Is the creator man or nature?" Hard to changeNewman is not trying to get traders to discard their 4Cscharts, as the system is so ingrained, she notes. But they should be aware ofthe additional elements affecting the value of a diamond. That's why sheemphasizes the 5Cs and 2Ts in the Handbook. "They can't just completely change over all their advertisingand all the materials they have, so I don't expect people to change the 4Cs.But I do expect them to understand all the price factors," she concludes. Image: Ren?(C)eNewman. (Ren?(C)eNewman)