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Do the 4Cs Still Make the Cut?

Renée Newman, author of a guide for the diamond trade, proposes a fifth C and two Ts.

May 6, 2019 7:26 AM   By Joshua Freedman
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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 only four diamond price factors — color, clarity, cut and carat weight,” Renée Newman, a graduate gemologist who last year published the third edition of her Diamond Handbook, says in an interview with Rapaport News. “In fact, there are other factors, such as the transparency and treatment status. They can have a large impact on price. We [in the trade] may know that, but the consumers don’t, because they just hear about the 4Cs.”

Transparency matters

The Gemological Institute of America (GIA) developed the 4Cs in the 1950s, when the industry considered cloudy diamonds to be industrial quality and didn’t put them into jewelry, the Handbook explains. Today, jewelers do use cloudy and hazy diamonds, but their clarity grades often don’t reflect their lower transparency, even though that characteristic can affect the value.

Newman distinguishes between clarity — a stone’s lack of inclusions and other blemishes — and the first “T,” transparency, which is how well it lets light pass. While a diamond with high clarity will have few or no inclusions, a stone is transparent if a viewer can see objects through it distinctly. Many laboratories don’t take into account subtle differences in transparency, Newman writes. “I’ve seen hazy and slightly cloudy diamonds with VS clarity grades,” she notes in the book.

How to treat treatments

Very few treated diamonds were on the market when the 4Cs came along, Newman explains. Most diamonds are still untreated now, but it’s becoming a larger minority as sellers seek to improve stones’ color, clarity and transparency.

This second “T” is important, as it hugely impacts the price. An untreated 1-carat, fancy-green, VS-clarity diamond will often fetch more than $200,000, compared with around $5,000 for an irradiated diamond with otherwise identical characteristics, Newman estimates. Treated diamonds are also much harder to resell.

A fifth “C” — and a sixth?

The “cut” part of the 4Cs needs to be two separate categories, she argues. In the 1950s, the trade didn’t differentiate between the shape and the quality of the cut when deciding prices, so it didn’t matter that the same term referred to both things. Now, the cutting style and shape are a distinct price factor from cut quality, with many labs providing a grade for the latter, she observes.

Meanwhile, rising interest in lab-grown diamonds has prompted Newman to consider an eighth criterion for a revised edition of one of her other books aimed at consumers.

“I left out a ‘C’ that I’m going to add when I redo my Diamond Ring Buying Guide, and that is the creator. Is the creator man or nature?”

Hard to change

Newman is not trying to get traders to discard their 4Cs charts, as the system is so ingrained, she notes. But they should be aware of the additional elements affecting the value of a diamond. That’s why she emphasizes the 5Cs and 2Ts in the Handbook.

“They can’t just completely change over all their advertising and 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: Renée Newman. (Renée Newman)
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Tags: 4cs, carat, carat weight, clarity, cloudy, color, cut, Diamond Handbook, Gemological Institute of America, GIA, hazy, inclusions, Joshua Freedman, Rapaport News, Renée Newman, transparency, treatments
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