Why is My Diamond Worth Less Than I Thought It Was?

Why Can't I Sell My Diamond for a Higher Price Than I Paid for It?
What's the Difference Between Consumer Grade Diamonds and High Quality Diamonds?

Have you heard that as soon as you drive a new car off the car lot, it loses several thousand dollars in value, perhaps as much as 10% or 15%? Part of the reason for the difference is dealer markup. No dealer is going to pay you full price for something he can buy brand new from the factory for 10% less than you just paid for it. The real value of the car is the dealer cost.  When I was young and bought our first car, I was like a lamb led to the slaughter.  I was rushed through a high-pressure sales pitch, was told I could take the car home today: all I had to do was sign on the dotted line.  The whole sales experience took less than an hour, and I paid full-retail price for the vehicle.  That was the last time I bought anything major without doing research, getting dealer costs, and negotiating a fair price based upon wholesale values.

Unfortunately, many of the major national jewelry chains take advantage of consumer ignorance and sell consumer grade diamonds for a tremendous mark up, far above any resale value. It isn't just the size of the diamond that matters. Although many young people and uneducated consumers think that a larger diamond is a better one, it just isn't true.  There are four factors in determining a diamond's value, often called the "4 C's." The 4 C's are Carats (weight/size), Color, Clarity, and Cut. A large diamond that has internal flaws, isn't as reflective, and isn't as clear as a smaller diamond may actually be less valuable.  Whereas a flawless, perfectly cut, clear diamond, even though small, may be worth thousands of dollars up to tens of thousands more. My point is that if you don't know the grade of your diamond, based upon those 4 C's, you don't know what you are buying, and it may be the reason you are disappointed whenever you try to sell your diamond to a dealer.  Many of these consumer grade diamonds are of no interest to a dealer, as they have no resale value at all, if the dealer has integrity and wants to deal fairly with his customers.

When looking for stones to buy from consumers, Joden World Resources is always looking for high quality, high value diamonds that will retain their value and appreciate over time.  We have often had to disappoint eager sellers with the sad truth that their stones are not worth anywhere near what they paid for them a few years ago, even in spite of inflation. It is one reason you should be buying diamonds with certified appraisals done by respected and well known gemologists, or buy stones that are independently appraised by a recognized agency like the Gemological Institute of America. Diamonds, which are appraised by the Institute, carry the G.I.A. certification papers.

At Joden World Resources, we have graduate gemologists, trained by the G.I.A, on staff. 

How Come the Dealer Gave Me an Appraisal That Said My Diamond Was Worth So Much More?

There is a difference between a laborat ory report and a jeweler's appraisal. Lab reports done by an outside agency like the G.I.A. are done by graduate gemologists and are independent from the sales department of any store.   Jewelers' appraisals may be based upon inaccurate information due to the fact that they may not be fully trained gemologists, even though they have many years of experience in the jewelry field. Also, jewelry store appraisals may be based upon the markup of what you paid at retail. The more the store's profit on the item, the more the appraisal value may be exaggerated.

Why is There a Difference Between the Replacement Value and What I Can Get for My Stone?

There is no easy answer to this question. An insurance value is the actual replacement value, or cost to a dealer to buy the diamond wholesale. However, if a jeweler has exaggerated the value of your original purchase, the replacement value does not represent what the diamond is worth to a dealer.

At Joden World Resources, we enjoy educating our customers on the true value of their purchases before they buy. It is important to us that our customers remain life long customers, and that is only possible if we treat them fairly. Our strength is in their knowledge. Even if they decide not to buy from us today, we have helped them to know what to ask and what to look for as they shop at other stores. Jewelry to us is not just a business; it is a passion we love to share with others.