Although the diamond is the hardest gem known to man, its composition is a simple one:  it is common carbon, like the graphite of pencils, but with a structure that involves a fusion point of 6900 degrees Fahrenheit, that is two times the fusion point of steel. Billions of years ago the elementary forces of heat and pressure transformed carbon into diamond. The volcanic mass in which this crystallization happened increased and came through the land crust cooling itself in the kimberlitic fireplaces. It is in fact in these kimberlitic fireplaces that diamonds are still found today
 

There are 4 main characteristics to be taken into consideration for a correct appraisal of a diamond:

• Colour
• Cut
• Clarity
• Carat

All four, or importantly their combination, confer to a diamond their uniqueness and determinate internationally a fair market value.
Following is a brief description of how these characteristics and how they effect the value of precious stones.

The colour of a diamond is perhaps its most appreciable characteristic, also to eye. The more the diamond is white and more light can be reflected crossing it. Obviously this quality greatly affects every stone’s value determining the price of a diamond. 
A diamond of colour  H  or  G  (that is with an optimal white colour) can  cost up to  50% more than a stone of  I colour other characteristics  being equal (cut, carats and purity). The appraisal of the colour of a diamond is extremely difficult and is carried out with the aid of coloured stones called “comparison stones”.
Various scales of appraisal of the colour of diamonds exist, one of the most used is the GIA scale (  Gemological institute of America ) that we summarize as follows.

D E F	G H	I J K	L M N	O P	Q R	S ==> Z
Exceptional white	Rare white	Slightly tinted white	Tinted white	Tinted colour
18 Carati.com© uses only G o H colour diamonds

The cut of a diamond represents in the last analysis the ability of a stone to reflect light in an optimal way and it determines therefore the brilliance. It is a common mistake to confuse the cut with the shape (which we talk about later). The most common shape is without a doubt "the brilliant cut", that is of round shape on the top. When observing  an ideally cut stone, the light enters from the top part of a diamond as refracted to straight angle the in order to leave  from the same part giving  the stone a remarkable brightness and "brilliance" (see diagram): The classic brilliant cut comprises 58 facets 33 of which located on the top part (or crown) and 25 on the bottom part (or pavilion). When the crown represents a third of the total height of the diamond, the best brilliance is obtained.

A - Crown B – Upper angle 34’ lower 41’ C - Culet D - Total depth 61.7% E - Table 55 - 57% F – Girdle diameter G – Lower girdle H – Main pavillon I - Pavillon 43%		A - Upper girdle B – Girdle C - Table D - Star E - Bezel F – 100 % G – 55 - 57%		The Ideal Cut
Different types of diamond cut
Brillante	Princess	Smeraldo	Radiant	Oval	Goccia	Navetta

The purity of a diamond is an important factor when determining the value. Diamonds without inclusions, that is totally without punctiform imperfections inside that are visible with 10X magnifying glass are real rarity.
Small imperfections called inclusions are very common. The smaller the inclusions (or their absence) determines how precious and valuable our stone will be.
It goes without saying that the differences in purity between similar stones are much difficult to establish by a layman and only a gemologist, with the aid of special white light and magnifying glass,  is able to establish if a diamond is  a Vvs2  (Very very small inclusions) rather than a Vs1  (Very small inclusions). To the eyes of layman they can appear identical when in fact there are remarkable differences in value.
For this reason it is always advisable to purchase diamond jewellery from trustable and expert traders. Always ask to know the characteristics of the diamond that you wish to acquire.
 

F - Flawless	VVS 1 -  Very Very Small Inclusions	VVS 2  - Very Very Small Inclusions	VS 1 - Very Small Inclusions	VS 2 - Very Small Inclusions
The diamond has no external or internal inclusions of whatever type under a 10X magnifier lens	The diamond contains of the minimal inclusions extremely difficult to find under a 10X magnifier lens	The diamond contains minimal inclusions barely identifiable under a 10X magnifier lens	The diamond  contains some observable inclusions which are not easily visible under a 10X magnifier lens	The diamond contains some noticeable inclusions visible under a 10X magnifier lens
SI 1 - Small Inclusions	SI 2 - Small Inclusions	I  1 -  Piquè	I 2 -  Piquè	I 3 -  Piquè
The diamond contains easily seen inclusions and/or characteristics with a 10 X magnifier lens	The diamond contains inclusions and/or characteristics easily seen visible under a 10X magnifier lens	The diamond contains obvious inclusions and/or very visible characteristics under a 10X magnifier lens	The diamond contains easily visible obvious inclusions	The diamond contains obvious  inclusions which are very easily visible

When talking about diamonds (or more in general of precious stones) the carat is simply the unit used to  measure its weight and is equivalent to a fifth of gram (0,20 grams). Be careful not to confuse the carat meaning the measurement of the purity (or fineness) used in precious metals such as gold or platinum which we will speak about later.
The carat, generally abbreviated in  Ct. ,  constitutes the measurement of the  weight of a precious stone. In the following table, we give approximate dimensions of round cut diamonds (called brilliant cute), which corresponds to given carat value.

The carat of a stone is also important in determining its value and not only because obviously the value increases as the carat increases, but also because bigger stones cost much more than the equivalent weight made of smaller stones. That means for instance that a one carat single stone (Ct. 1.00) is a lot more valuable then 100 stones of 1 point of a carat (Ct. 0.01).
Referring to the carat of diamonds “points” are  often mentioned; The point of carat is the hundredth part of the carat (= 0,002 grams) and it is often used for weighing of very small diamonds .

The

Is the precious metal ‘par excellece’. In its pure state (gold 1000/ooo) it is a very malleable and ductile metal and therefore not suitable for use in jewelry and for this reason is alloyed with other metals to give it those characteristics of hardness necessary in order to increase its resistance.
The gold alloys can be varied in colour and the purity that one wants to obtain, but in general they abide (also by law) to one internationally recognized classification based on the percentage of pure gold contained.