The Rapaport Diamond Index - A secret experts' file or a useful tool for diamond consumers?

The Rapaport Diamond Index is a weekly report, providing jewelers and diamond traders with important information about the value of a diamond, based on current market trends. The report is written in a table form, marking the money value of a stone relying on four key parameters - The four C's (cut, carat, clarity, color).

Martin Rapaport - Bill Gates of the Diamond Industry

The founder of the Rapaport Diamond Index is perhaps the most prominent character of the diamond industry in the recent 30 years. Rapaport grew up in a family of jewelry experts in Belgium. In the mid 1970's Rapaport moved to New York City and worked as a diamond polisher and a merchant of rough diamonds.

Rapaport's expertise in the diamond international market had encouraged him to produce a document which is in fact a standard diamond value report. Although diamond grading, executed for many years by diamond institutes is itself creating international standards and doesn't allow much subjectivity, the Rapaport Report had raised much objection and Rapaport was blamed for trying to commodify diamonds. The De Beers Group claimed that Martin Rapaport ignores the imagination and illusion which assemble the "magic" of diamonds, by applying concrete laws of supply and demand on diamonds, as if they were any other merchandise.

Though some jewelers still undermine the Rapaport Index, its usefulness cannot be neglected, as many merchants use it daily. Today Martin Rapaport owns a successful diamond information business. Because most diamond dealers base their business on the Rapaport List, much pressure is put on Rapaport to lower and raise the prices of certain stones, according to the dealers' needs.  

How to read the Rapaport Index?

The Rapaport Report is published in the weekly Rapaport magazine, to which most jewelers and diamond traders are subscribed. The report itself is divided into small tables. Each diamond shape (round, emerald, princess, etc) has its own set of tables, among which a separate table to several carat range exists. In the left column of the table, the color grade of a diamond is noted, in a descending order from D to M (lower color grades aren't mentioned in this report), while the clarity grade is stated in the upper row, from IF on the left side down to I2 on the right. The values inside the table basically state the money worth of 1 carat diamond in $100's, according to the stone's color and clarity grade, as aforesaid.

The Rapaport List represents changing trends in demand and supply of diamond, according to the four C's. It doesn't attempt to tackle more subtle issues of diamond symmetry and proportions, neither it includes rare fancy diamonds. Therefore, if the list is used wisely it doesn't have to suppress the freedom of choosing a stone that fits one's own taste and needs as it simply reflects which diamonds are of high demand worldwide in a certain moment. While the De Beers group finds the Rapaport Standards disregarding diamonds' uniqueness, most merchants are glad to use this tool, which determines a diamond's value on supply and demand trends and not merely on the whim of big diamond corporations, like De Beers.

This is an example of one of the tables in the 7/31/09 Rapaport Table Index, referring to Round Cut diamonds in the range of 1-1.49 Carats. The upper left value, expressing the value of a D color IF clarity diamond would clearly be the highest per carat, as it possesses the highest qualities. Clarity and color both have a significant effect on the value of a stone, though a drop of one color grade reduces the diamond's value slightly more than the value difference between one clarity grade and the following one.

Diamond merchants are loyal subscribers to the Rapaprt Index, then why shouldn't every diamond consumer use the list?! First of all, it isn't easy to get a hold of a report if you don't have connections in the jewelry business. A new report is published every week, and prices are updated constantly. One should also remember that the prices merchants spend on diamond doesn't express the final consumer price as many price modifications are done in accord to the dictation of the smaller, specific, market.

When one comes to buy a diamond it could be educating to learn about the Rapaport Index, understand how the four C's affect diamond pricing and get to know the current worldwide trends in diamond trading as well. However, when selecting a stone, diamond certificate and diamond appraisal, not to mention much more one's subjective needs are still the most important tools to guide a diamond consumer to make a good decision.