Cut, colour, clarity and carat are all considered when purchasing what?
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A diamond cut is a style or design guide used when shaping a diamond for polishing such as the brilliant cut. Cut does not refer to shape (pear, oval), but the symmetry, proportioning and polish of a diamond. The cut of a diamond greatly affects a diamond's brilliance; this means if it is cut poorly, it will be less luminous.

In order to best use a diamond gemstone's material properties, a number of different diamond cuts have been developed. A diamond cut constitutes a more or less symmetrical arrangement of facets, which together modify the shape and appearance of a diamond crystal. Diamond cutters must consider several factors, such as the shape and size of the crystal, when choosing a cut. The practical history of diamond cuts can be traced back to the Middle Ages, while their theoretical basis was not developed until the turn of the 20th century. Design creation and innovation continue to the present day: new technology—notably laser cutting and computer-aided design—has enabled the development of cuts which complexity, optical performance, and waste reduction were hitherto unthinkable.

The most popular of diamond cuts is the modern round brilliant, which facet arrangements and proportions have been perfected by both mathematical and empirical analysis. Also popular are the fancy cuts, which come in a variety of shapes—many of which were derived from the round brilliant. A diamond's cut is evaluated by trained graders, with higher grades given to stones whose symmetry and proportions most closely match the particular "ideal" used as a benchmark. The strictest standards are applied to the round brilliant; although its facet count is invariable, its proportions are not. Different countries base their cut grading on different ideals: one may speak of the American Standard or the Scandinavian Standard (Scan. D.N.), to give but two examples.

History

The history of diamond cuts can be traced to the late Middle Ages, before which time diamonds were employed in their natural octahedral state—anhedral (poorly formed) diamonds simply were not used in jewelry. The first "improvements" on nature's design involved a simple polishing of the octahedral crystal faces to create even and unblemished facets, or to fashion the desired octahedral shape out of an otherwise unappealing piece of rough. This was called the point cut and dates from the mid 14th century; by 1375 there was a guild of diamond polishers at Nürnberg. By the mid 15th century, the point cut began to be improved upon: a little less than one half of the octahedron would be sawn off, creating the table cut. The importance of a culet was also realised, and some table-cut stones may possess one. The addition of four corner facets created the old single cut (or old eight cut). Neither of these early cuts would reveal what diamond is prized for today; its strong dispersion or fire. At the time, diamond was valued chiefly for its adamantine lustre and superlative hardness; a table-cut diamond would appear black to the eye, as they do in paintings of the era. For this reason, colored gemstones such as ruby and sapphire were far more popular in jewelry of the era.

In or around 1476, Lodewyk (Louis) van Berquem, a Flemish polisher of Bruges, introduced the technique of absolute symmetry in the disposition of facets using a device of his own invention, the scaif. He cut stones in the shape known as pendeloque or briolette; these were pear-shaped with triangular facets on both sides. About the middle of the 16th century, the rose or rosette was introduced in Antwerp: it also consisted of triangular facets arranged in a symmetrical radiating pattern, but with the bottom of the stone left flat—essentially a crown without a pavilion. Many large, famous Indian diamonds of old (such as the Orloff and Sancy) also feature a rose-like cut; there is some suggestion that Western cutters were influenced by Indian stones, because some of these diamonds may predate the Western adoption of the rose cut. However, Indian "rose cuts" were far less symmetrical as their cutters had the primary interest of conserving carat weight, due to the divine status of diamond in India. In either event, the rose cut continued to evolve, with its depth, number and arrangements of facets being tweaked.

The first brilliant cuts were introduced in the middle of the 17th century. Known as Mazarins, they had 17 facets on the crown (upper half). They are also called double-cut brilliants as they are seen as a step up from old single cuts. Vincent Peruzzi, a Venetian polisher, later increased the number of crown facets from 17 to 33 (triple-cut or Peruzzi brilliants), thereby significantly increasing the fire and brilliance of the cut gem, properties that in the Mazarin were already incomparably better than in the rose. Yet Peruzzi-cut diamonds, when seen nowadays, seem exceedingly dull compared to modern-cut brilliants. Because the practice of bruting had not yet been developed, these early brilliants were all rounded squares or rectangles in cross-section (rather than circular). Given the general name of cushion—what are known today as old mine cuts—these were common by the early 18th century. Sometime later the old European cut was developed, which had a shallower pavilion, more rounded shape, and different arrangement of facets. The old European cut was the forerunner of modern brilliants and was the most advanced in use during the 19th century.

Around 1900, the development of diamond saws and good jewelry lathes enabled the development of modern diamond cutting and diamond cuts, chief among them the round brilliant cut. In 1919, Marcel Tolkowsky analyzed this cut: his calculations took both brilliance (the amount of white light reflected) and fire into consideration, creating a delicate balance between the two. Tolkowsky's calculations would serve as the basis for all future brilliant cut modifications and standards.

Tolkowsky's model of the "ideal" cut is not perfect. The original model served as a general guideline, and did not explore or account for several aspects of diamond cut: 

Because every facet has the potential to change a light ray's plane of travel, every facet must be considered in any complete calculation of light paths.

Just as a two-dimensional slice of a diamond provides incomplete information about the three-dimensional nature of light behavior inside a diamond, this two-dimensional slice also provides incomplete information about light behavior outside the diamond. A diamond's panorama is three-dimensional. Although diamonds are highly symmetrical, light can enter a diamond from many directions and many angles. This factor further highlights the need to reevaluate Tolkowsky's results, and to recalculate the effects of a diamond's proportions on its appearance aspects. ...

Another important point to consider is that Tolkowsky did not follow the path of a ray that was reflected more than twice in the diamond. However, we now know that a diamond's appearance is composed of many light paths that reflect considerably more than two times within that diamond. Once again, we can see that Tolkowsky's predictions are helpful in explaining optimal diamond performance, but they are incomplete by today's technological standards.

Tolkowsky's guidelines, while revolutionary in their day, are not a definitive solution to the problem of finding the optimum proportions of a round brilliant cut diamond.

In the 1970s, Bruce Harding developed another mathematical model for gem design.
Since then, several groups have used computer models  and specialized scopes to design diamond cuts.

The world's top diamond cutting and polishing center is India. It processes 11 out of 12 diamonds in jewelry worldwide. The sector employs 1.3 million people and accounts for 14% of India's $80 billion of annual exports. Its share in the world polished diamond market is 92% by pieces and 55% by value.

Theory

In its rough state, a diamond is fairly unremarkable in appearance. Most gem diamonds are recovered from secondary or alluvial deposits, and such diamonds have dull, battered external surfaces often covered by a gummy, opaque skin—a comparison to "lumps of washing soda" is apt. The act of polishing a diamond and creating flat facets in symmetrical arrangement brings out the diamond's hidden beauty in dramatic fashion.

When designing a diamond cut, two primary factors are considered. Foremost is the refractive index (RI) of a diamond, which, at 2.417 (as measured by sodium light, 589.3 nm), is fairly high compared with that of most other gems. Diamond's RI is responsible for its brilliance—the amount of incident light reflected back to the viewer. Also important is a diamond's dispersive power—the ability of the material to split white light into its component spectral colors—which is also relatively high, at 0.044 (as measured from the B-G interval). The flashes of spectral colors—known as fire—are a function of this dispersion, but are, like brilliance, only apparent after cutting.

Brilliance can be divided into the definitions external brilliance and internal brilliance. The former is the light reflected from the surface of the stone—its luster. Diamond's adamantine ("diamond-like") luster is second only to metallic (i.e., that of metals); while it is directly related to RI, the quality of a finished gem's polish will determine how well a diamond's luster is borne out.

Internal brilliance—the percentage of incident light reflected back to the viewer from the rear (pavilion) facets—relies on careful consideration of a cut's interfacial angles as they relate to diamond's RI. The goal is to attain total internal reflection (TIR) by choosing the crown angle and pavilion angle (the angle formed by the pavilion facets and girdle plane) such that the reflected light's angle of incidence (when reaching the pavilion facets) falls outside diamond's critical angle, or minimum angle for TIR, of 24.4°. Two observations can be made: if the pavilion is too shallow, light meets the pavilion facets within the critical angle, and is refracted (i.e., lost) through the pavilion bottom into the air. If the pavilion is too deep, light is initially reflected outside the critical angle on one side of the pavilion, but meets the opposite side within the critical angle and is then refracted out the side of the stone.

The term scintillation brilliance is applied to the number and arrangement of light reflections from the internal facets; that is, the degree of "sparkle" seen when the stone or observer moves. Scintillation is dependent on the size, number, and symmetry of facets, as well as on quality of polish. Very small stones will appear milky if their scintillation is too great (due to the limitations of the human eye), whereas larger stones will appear lifeless if their facets are too large or too few.

A diamond's fire is determined by the cut's crown height and crown angle (the crown being the top half of the stone, above the girdle), and the size and number of facets that compose it. The crown acts as a prism: light exiting the stone (after reflection from the pavilion facets) should meet the crown facets at as great an angle of incidence from the normal as possible (without exceeding the critical angle) in order to achieve the greatest fanning out or spread of spectral colors. The crown height is related to the crown angle, the crown facet size, and the table size (the largest central facet of the crown): a happy medium is sought in a table that is not too small (which would result in larger crown facets and greater fire at the expense of brilliance) or too large (which would result in smaller crown facets and little to no fire).

Polish and symmetry

Polish and symmetry are two important aspects of the cut. The polish describes the smoothness of the diamond's facets, and the symmetry refers to alignment of the facets. With poor polish, the surface of a facet can be dulled, and may create blurred or dulled sparkle. Often the surface of a poor polished diamond will have grain lines running across the facet. It may also constantly look like it needs to be cleaned. With poor symmetry, light can be misdirected as it enters and exits the diamond.

Choice of cut

The choice of diamond cut is often decided by the original shape of the rough stone, location of internal flaws or inclusions, the preservation of carat weight, and popularity of certain shapes among consumers. The cutter must consider each of these variables before proceeding.

Most gem-quality diamond crystals are octahedra in their rough state (see material properties of diamond). These crystals are usually cut into round brilliants because it is possible to cut two such stones out of one octahedron with minimal loss of weight. If the crystal is malformed or twinned, or if inclusions are present at inopportune locations, the diamond is more likely to receive a fancy cut (a cut other than a round brilliant). This is especially true in the case of macle, which are flattened twin octahedron crystals. Round brilliants have certain requisite proportions that would result in high weight loss, whereas fancy cuts are typically much more flexible in this regard. Sometimes the cutters compromise and accept lesser proportions and symmetry in order to avoid inclusions or to preserve carat weight, since the per-carat price of diamond is much higher when the stone is over one carat (200 mg).

While the round brilliant cut is considered standard for diamond, with its shape and proportions nearly constant, the choice of fancy cut is influenced heavily by fashion. For example, the step cut baguette—which accentuates a diamond's luster, whiteness, and clarity but downplays its fire—was all the rage during the Art Deco period, whereas the mixed Princess cut—which accentuates a diamond's fire and brilliance rather than its luster—is currently gaining popularity. The princess cut is also popular among diamond cutters: of all the cuts, it wastes the least of the original crystal. Older diamonds cut before ca. 1900 were cut in "primitive" versions of the modern round brilliant, such as the rose cut and old mine cut (see History section). Although there is a market for antique stones, many are recut into modern brilliants to increase their marketability. There is also increasing demand for diamonds to be cut in older styles for the purpose of repairing or reproducing antique jewelry. 

The size of a diamond may also be a factor. Very small (

Fancy cuts

Even with modern techniques, the cutting and polishing of a diamond crystal always results in a dramatic loss of weight; rarely is it less than 50%. The round brilliant cut is preferred when the crystal is an octahedron, as often two stones may be cut from one such crystal. Oddly-shaped crystals such as macles are more likely to be cut in a fancy cut (that is, a cut other than the round brilliant), which the particular crystal shape lends itself to. The prevalence and choice of a particular fancy cut is also influenced by fashion; generally speaking, these cuts are not held to the same strict standards as Tolkowsky-derived round brilliants. Most fancy cuts can be grouped into four categories: modified brilliants, step cuts, mixed cuts, and rose cuts.

Modified brilliants

This is the most populous category of fancy cut, because the standard round brilliant can be effectively modified into a wide range of shapes. Because their facet counts and facet arrangements are the same, modified brilliants also look (in terms of brilliance and fire interplay) the most like round brilliants and are therefore (in general and at present) the most saleable.

Modified brilliants include the marquise or navette (French for "little boat", because it resembles the hull of a sailboat), heart, triangular trillion (also trillian or trilliant), oval, and the pear or drop cuts. These are the most commonly encountered modified brilliants;
Oval-shaped diamonds have been created and introduced by Lazare Kaplan way back in the 1960s. Usually noted to have 56 facets, the weight of such diamonds is estimated by measuring the length and width of the stone. A ratio of 1.33 to 1.66 provides a good traditional range of oval-shaped diamonds.
Pear-shaped diamonds are also known as the teardrop shape owing to their resemblance and is considered as a hybrid between the marquise cut and the round brilliant diamond. The stone has one end rounded while the other end is pointed. Pear shape diamonds can opt between varying length and width ratios for the ideal looking pear-shaped diamond. Length to width ratios between 1.45 and 1.75 are most common.

Modern cutting technology has allowed the development of increasingly complex and hitherto unthinkable shapes, such as stars and butterflies. Their proportions are mostly a matter of personal preference; however, due to their sharp terminations and diamond's relative fragility, these cuts are more vulnerable to accidental breakage and may therefore be more difficult to insure.

There are several older modified brilliant cuts of uncertain age that, while no longer widely used, are notable for history's sake. They are all round in outline and modify the standard round brilliant by adding facets and changing symmetry, either by dividing the standard facets or by placing new ones in different arrangements. These cuts include: the King and Magna cut, both developed by New York City firms, with the former possessing 86 facets and 12-fold symmetry and the latter with 102 facets and 10-fold symmetry; the High-Light cut, developed by Belgian cutter M. Westreich, with 16 additional facets divided equally between the crown and pavilion; and the Princess 144, introduced in the 1960s, with 144 facets and 8-fold symmetry. Not to be confused with the mixed Princess cut, the Princess 144 cut makes for a lively stone with good scintillation; the extra facets are cut under the girdle rather than subdivided. The extra care required for these sub-girdle facets benefits the finished stone by mitigating girdle irregularity and bearding (hairline fracturing).
Today, with the increased understanding of light dynamics and diamond cutting, many companies have developed new, modified round brilliant cut diamonds. If designed correctly, these extra facets of the modified round brilliant could benefit the overall beauty of a diamond, such as in 91 facet diamonds.

The Dutch firm Gassan has patented a new cut with 121 facets.

Step cuts

Stones whose outlines are either square or rectangular and whose facets are rectilinear and arranged parallel to the girdle are known as step- or trap-cut stones. These stones often have their corners truncated, creating an emerald cut (after its most common application to emerald gemstones) with an octagonal outline. This is done because sharp corners are points of weakness where a diamond may cleave or fracture. Instead of a culet, step-cut stones have a keel running the length of the pavilion terminus. Like other fancy shaped diamonds, emerald cut diamonds can come in a variety of length to width ratios. The most popular and classic outline of emerald cut diamonds are close a value of 1.5.

Because both the pavilion and crown are comparatively shallow, step cut stones are generally not as bright and never as fiery as brilliant cut stones, but rather accentuate a diamond's clarity (as even the slightest flaw would be highly visible), whiteness, and lustre (and therefore good polish).

Due to the current vogue for brilliant and brilliant-like cuts, step cut diamonds may suffer somewhat in value; stones that are deep enough may be re-cut into more popular shapes. However, the step cut's rectilinear form was very popular in the Art Deco period. Antique jewelry of the period features step-cut stones prominently, and there is a market in producing new step-cut stones to repair antique jewelry or to reproduce it. The slender, rectangular baguette (from the French, resembling a loaf of bread) was and is the most common form of the step cut: today, it is most often used as an accent stone to flank a ring's larger central (and usually brilliant-cut) stone.

Square step cuts whose corners are not truncated are known as carré; they are also characteristic of antique jewelry. They may resemble the square-shaped Princess cut in passing, but a carré's lack of fire and simpler facets are distinctive. They may or may not have a culet. In Western jewelry dating to before the advent of brilliant-type cuts, very shallow step-cut stones were used as lustrous covers for miniature paintings: these are known in the antique trade as portrait stones. Characteristic of Indian jewelry are lasque diamonds, which may be the earliest form of step cut. They are flat stones with large tables and asymmetric outlines.

Other forms of the step cut include triangle (or Trilliant cut), kite, lozenge, trapeze (or trapezoid), and obus shapes.

Mixed cuts

Mixed cuts share aspects of both (modified) brilliant and step cuts: they are meant to combine the weight preservation and dimensions of step cuts with the optical effects of brilliants. Typically the crown is brilliant cut and the pavilion step-cut. Mixed cuts are all relatively new, with the oldest dating back to the 1960s. They have been extremely successful commercially and continue to gain popularity, loosening the foothold of the de facto standard round brilliant.

Among the first mixed cuts was the Barion cut, introduced in 1971. Invented by South African diamond cutter Basil Watermeyer and named after himself and his wife Marion, the basic Barion cut is an octagonal square or rectangle, with a polished and faceted girdle. The total facet count is 62 (excluding the culet): 25 on the crown; 29 on the pavilion; and 8 on the girdle. This cut can be easily identified by the characteristic central cross pattern (as seen through the table) created by the pavilion facets, as well as by the crescent-shaped facets on the pavilion. A similar cut is the Radiant cut: It differs in having a total of 70 facets. Both it and the Barion cut exist in a large number of modified forms, with slightly different facet arrangements and combinations.

The most successful mixed cut is the Princess cut, first introduced in 1960 by A. Nagy of London. It was originally intended for flat rough (macles), but has since become popular enough that some gemological labs, such as that of the American Gem Society (AGS), have developed Princess cut grading standards with stringency akin to standards applied to round brilliants. Its higher fire and brilliance compared to other mixed cuts is one reason for the Princess cut's popularity, but more importantly is the fact that, of all the diamond cuts, it wastes the least of the original crystal. Another beautiful cut is the Flanders cut, a modified square with cut corners, brilliant facets and is currently being cut by cutters at Russian Star.

Rose and mogul cuts

Various forms of the rose cut have been in use since the mid-16th century. Like the step cuts, they were derived from older types of cuts. The basic rose cut has a flat base - that is, it lacks a pavilion - and has a crown composed of triangular facets (usually 12 or 24) rising to form a point (there is no table facet) in an arrangement with sixfold rotational symmetry. The so-called double rose cut is a variation that adds six kite facets at the margin of the base. The classic rose cut is circular in outline; non-circular variations on the rose cut include the briolette (oval), Antwerp rose (hexagonal), and double Dutch rose (resembling two rose cuts united back-to-back). Rose-cut diamonds are seldom seen nowadays, except in antique jewelry. Like the older style brilliants and step cuts, there is a growing demand for the purpose of repairing or reproducing antique pieces.

Related to the rose cut, and of similar antiquity, is the mogul cut, named after the Great Mogul diamond that was the most famous example of its type. Like the classic rose cut, the mogul cut also lacks a pavilion and a table facet, and its crown is also composed of triangular facets rising to form a point. But in mogul-cut diamonds the rotational symmetry is normally fourfold or eightfold, and the eight apical facets are girded by two or more additional rings of facets. The modern mogul cut evolved from earlier faceting techniques originally used to disguise internal flaws in very large stones; in the modern day this cut has also become rare, but still finds occasional use where it is less important to showcase a stone's internal clarity, as with the black and internally opaque Spirit of de Grisogono Diamond.

Cut grading

The "Cut" of the "4-Cs" is the most difficult part for a consumer to judge when selecting a good diamond. This is because some certificates will not show the important measurements influencing cut (such as the pavilion angle and crown angle) and will not provide a subjective ranking of how good the cut was. The other 3-Cs can be ranked simply by the rating in each category. It requires a trained eye to judge the quality of a diamond cut, and the task is complicated by the fact that different standards are used in different countries (see proportions of the round brilliant).

Other proportions also affect the look of the diamond:
*The table ratio is very significant.
*The length of the lower girdle facets affects whether Hearts and arrows can be seen in the stone, under certain viewers.
**Most round brilliant diamonds have roughly the same girdle thickness at all 16 "thick parts".
**So-called "cheated" girdles have thicker girdles where the main facets touch the girdle than where adjacent upper girdle facets touch the girdle. These stones weigh more (for a given diameter, average girdle thickness, crown angle, pavilion angle, and table ratio), and have worse optical performance (their upper girdle facets appear dark in some lighting conditions).
**So-called "painted" girdles have thinner girdles where the main facets touch the girdle than where adjacent upper girdle facets touch the girdle. These stones have less light leakage at the edge of the stone (for a given crown angle, pavilion angle, and table ratio), but does have a negative effect on the overall beauty of a diamond. 

Several groups have developed diamond cut grading standards. They all disagree somewhat on which proportions make the best cut. There are certain proportions that are considered best by two or more groups however.
*The AGA standards may be the strictest at the upper range of quality. David Atlas developed the AGA standards in the 1990s for all standard diamond shapes. 
*The HCA changed several times between 2001 and 2004. As of 2004, an HCA score below two represented an excellent cut. The HCA distinguishes between brilliant, Tolkowsky, and fiery cuts.
*The AGS standards changed in 2005 to better match Tolkowsky's model and Octonus' ray tracing results. The 2005 AGS standards penalize stones with "cheated" girdles. They grade from 0 to 10.
*The GIA began grading cut on every grading report for round brilliant beginning January 1, 2006 based on their comprehensive study of 20,000 proportions with 70,000 observations of 2,000 diamonds. The single descriptive words are as follows: Excellent, Very Good, Good, Fair, and Poor.
The distance from the viewer's eye to the diamond is important.
The 2005 AGS cut standards are based on a distance of 25 centimeters (about 10 inches).
The 2004 HCA cut standards are based on a distance of 40 centimeters (about 16 inches).
*Various labs around the world are using ImaGem's VeriGem device to measure Light Behavior. DGLA in the USA and Mumbai, India, PGGL in the USA and EGL-USA are both offering versions of this grading in 2008. DGLA has graded thousands of diamonds with this promising direct assessment technology.
*"Brilliancescope" by Gemex is another assessment light behavior technology in use by many US and now foreign retailers and diamond cutters.

Effect of cut on other diamond characteristics 

During the diamond cutting process, the diamond cutter wants to get the heaviest diamond out of a rough stone. However, this can come at the cost of lowering cut grade. If a diamond is too deep, the carat weight will increase but result in a loss of brilliance due to light leakage. Diamond cutters have to contend with working a stone to its best finished form with the least amount of waste. This strategy depends on the quality of the stone and its final proportions. If two diamonds of equal weight are inspected there can be a noticeable difference in size when viewed from above; arguably the most important view. A well cut 0.90ct diamond for example could have the same width as a poorly cut 1.00ct diamond. This phenomenon is known as spread. Diamond clarity is a quality of diamonds relating to the existence and visual appearance of internal characteristics of a diamond called inclusions, and surface defects called blemishes. Clarity is one of the four Cs of diamond grading, the others being carat, color, and cut.  Inclusions may be crystals of a foreign material or another diamond crystal, or structural imperfections such as tiny cracks that can appear whitish or cloudy. The number, size, color, relative location, orientation, and visibility of inclusions can all affect the relative clarity of a diamond. A clarity grade is assigned based on the overall appearance of the stone under ten times magnification.

Most inclusions present in gem-quality diamonds do not affect the diamonds' performance or structural integrity and are not visible to the naked eyes. However, large clouds can affect a diamond's ability to transmit and scatter light. Large cracks close to or breaking the surface may reduce a diamond's resistance to fracture.

Diamonds with higher clarity grades are more valued, with the exceedingly rare Flawless graded diamond fetching the highest price. Minor inclusions or blemishes are useful, as they can be used as unique identifying marks analogous to fingerprints. In addition, as synthetic diamond technology improves and distinguishing between natural and synthetic diamonds becomes more difficult, inclusions or blemishes can be used as proof of natural origin.

Inclusions and blemishes

There are several types of inclusions and blemishes, which affect a diamond's clarity to varying degrees. Features resulting from diamond enhancement procedures, such as laser lines, are also considered inclusions or blemishes.

Inclusions

*Clouds
*Feathers
*Included crystals or minerals
*Knots
*Cavities
*Cleavage
*Bearding
*Internal graining
*Pinpoint
*Laser lines

The diamond industry uses the term "internal characteristics" instead of "inclusions". For natural diamonds, the "internal characteristics" in the diamond are growth crystals that give the diamond its character and unique fingerprint. When diamonds are graded, they are magnified at 10x power.

Blemishes

*Polish lines
*Grain boundaries
*Naturals
*Scratches
*Nicks
*Pits
*Chips
*Breaks
*Dark spots
*Light spots

Clarity grading

Gemological Institute of America (GIA)

History

In 1952, Richard T. Liddicoat, along with Marquis Person, Joe Phillips, Robert Crowningshield and Bert Krashes began to work on a new diamond grading system which they called the "diamond grading and evaluation appraisal". In 1953, they released their new system which assessed three aspects of diamonds; make, color and clarity. They took terminology used in the industry at the time and refined the definitions to produce a clarity scale by which diamonds could be consistently graded. The system at that time contained nine grades: Flawless, VVS1, VVS2, VS1, VS2, SI1, SI2, I1, and I2. The 'I' of the I1, and I2 grades originally stood for "Imperfect".

During the 1970s, two changes were made to the system. Firstly, the Internally Flawless grade was added, as GIA noticed that many diamonds were being aggressively cut to remove any surface blemishes, and thereby reducing the cutting quality ("make") of the diamonds. The Internally Flawless grade gave diamond manufacturers a choice to leave blemishes on the surface of the stone, and achieve a grade higher than VVS1. The second change made to the grading system was the introduction of the I3 grade. This change was made in response to a growing number of diamonds of very low clarity being cut.

The last change to the clarity grading system took place in the 1990s when the term "imperfect" was changed to "included".

The GIA grading system today

The GIA diamond grading scale is divided into six categories and eleven grades."Diamonds and Diamond Grading" course material - Book 11, Grading Clarity, Gemological Institute of America, 2002 The clarity categories and grades are:
*Flawless category (FL) diamonds have no inclusions or blemishes visible under 10x magnification.
*Internally Flawless category (IF) diamonds have no inclusions visible under 10x magnification, only small blemishes on the diamond surface.
*Very, Very Slightly Included category (VVS) diamonds have minute inclusions that are difficult for a skilled grader to see under 10x magnification. The VVS category is divided into two grades; VVS1 denotes a higher clarity grade than VVS2. Pinpoints and needles set the grade at VVS.
*Very Slightly Included category (VS) diamonds have minor inclusions that are difficult to somewhat easy for a trained grader to see when viewed under 10x magnification. The VS category is divided into two grades; VS1 denotes a higher clarity grade than VS2. Typically the inclusions in VS diamonds are invisible without magnification; however, infrequently some VS2 inclusions may still be visible. An example would be on a large emerald cut diamond which has a small inclusion under the corner of the table.
*Slightly Included category (SI) diamonds have noticeable inclusions that are easy to very easy for a trained grader to see when viewed under 10x magnification. The SI category is divided into two grades; SI1 denotes a higher clarity grade than SI2. These may or may not be noticeable to the naked eye.
*Included category (I) diamonds have obvious inclusions that are clearly visible to a trained grader under 10x magnification. Included diamonds have inclusions that are usually visible without magnification or have inclusions that threaten the durability of the stone. The I category is divided into three grades; I1 denotes a higher clarity grade than I2, which in turn is higher than I3. Inclusions in I1 diamonds often are seen by the unaided eye. I2 inclusions are easily seen, while I3 diamonds have large and extremely easy to see inclusions that typically impact the brilliance of the diamond, as well as having inclusions that are often likely to threaten the structure of the diamond.

GIA clarity grading procedure

GIA clarity grading is performed under 10x magnification with darkfield illumination. The GIA Laboratory uses as standard equipment binocular stereo microscopes which are able to zoom to higher magnifications. These microscopes are equipped with darkfield illumination, as well as an ultraviolet filtered overhead light. When grading is performed using a 10x handheld loupe, darkfield illumination is more difficult to achieve. The grader must use a light source in such a way that the base of the stone is lit from the side, and the crown of the stone is shielded from the light.

After thoroughly cleaning the diamond, the diamond is picked up using tweezers in a girdle-to-girdle hold. The grader views the diamond for the first time through the table, studying the culet area of the stone for inclusions. The diamond is then set down and picked up with the tweezers in a table-to-culet hold. In this position, the diamond can be studied from the pavilion side, and the crown side, examining the diamond through each facet for inclusions. Once a sector of the diamond has been thoroughly examined, the grader rotates the diamond in the tweezer, so that the neighboring sector can be examined. The grader uses darkfield lighting to reveal characteristics, and alternates to reflected, overhead lighting to ascertain whether a characteristic lies within the stone, on the stones surface, or both. If the grader is using a stereo microscope, she may zoom in to a higher magnification to make closer observations of an inclusion, but then return to 10x magnification to make an assessment of its impact on the clarity grade.

If a stereo binocular microscope has been used, a final assessment using a 10x loupe is performed before the final judgment is made on the clarity of the stone. The grader first decides the clarity category of the diamond: none (FL, or IF for a blemish), minute (VVS), minor (VS), noticeable (SI), or obvious (I). The decision is then made on the grade of the diamond.  

Grading systems by other organizations

The clarity grading system developed by the GIA has been used throughout the industry as well as by other diamond grading agencies including the American Gemological Society (AGS), and the International Gemological Institute (IGI). There are other smaller labs which use the GIA system as well.  These grading agencies base their clarity grades on the characteristics of inclusions visible to a trained professional when a diamond is viewed from above under 10x magnification.

Confédération Internationale de la Bijouterie, Joaillerie, Orfèvrerie des Diamants, Perles et Pierres (CIBJO)

The CIBJO or the International Confederation of Jewellery, Silverware, Diamonds and Stones developed the International Clarity Scale for grading diamonds. This clarity scale mirrors the GIA grading scale, except nomenclature varies. The CIBJO system names these clarity grades; Loupe Clean, Very, very small inclusions (VVS1 and VVS2), Very small inclusions (VS1 and VS2), Small inclusions (SI1 and SI2), Pique (P1, P2, and P3).

Clarity grading by CIBJO standards is by examination using a 10x achromatic, aplanatic loupe in normal light.

American Gem Society

The American Gem Society grades clarity on a number scale between 0 and 10. These numbers grades correlate almost exactly with the GIA system, but with some differences. The flawless and internally flawless (0) grades are grouped together with notation defining whether the stone is free from external blemishes, the VVS through SI grades are numbered 1 through 6, and then there are four grades 7 through 10 for the included category.

Clarity grading by AGS standards requires examination using a binocular stereo microscope equipped with adjustable zoom magnification and darkfield illumination. 

International Diamond Council (IDC)

The IDC or the International Diamond Council uses a very similar standard to CIBJO. IDC loupe clean stones that have external blemishes have notations made on the grading report. IDC clarity grading is by examination using a 10x achromatic, aplanatic loupe in normal light.

European Gemological Laboratory

The European Gemological Laboratory (EGL) introduced the SI3 as a clarity grade. While intended as a range to include borderline SI2 / I1 stones, it is now commonly used to mean I1's which are "eye clean", that is, which have inclusions which are not obviously visible to the naked eye.

Clarity grading considerations

All grades reflect the appearance to an experienced grader when viewed from above at 10x magnification, though higher magnifications and viewing from other angles are used during the grading process. The grader studies the diamond for internal characteristics and judges them on the basis of five clarity factors: size, number, position, nature, and color or relief. The clarity grade is assessed on the basis of the most noticeable inclusions, the so-called "grade setting inclusions". Less significant inclusions are ignored for the purposes of setting the grade; however, they may still be plotted onto a diamond plot chart.

Accurate clarity grading as with other grading steps must be done with the diamond "loose" (not set into any mounting). Inclusions are often difficult to see from the crown side of the diamond, and may be concealed by the setting.

Size

The first clarity factor which is assessed is a clarity characteristic's size. Larger characteristics are typically more noticeable under magnification, thereby placing the diamond into a lower clarity grade.

Number

The second clarity factor which is assessed is the number of clarity characteristics. Generally, the more characteristics, the lower the clarity grade. This assessment is made by judging how readily they can be seen, not by the actual number of characteristics.

Position

The third clarity factor which is assessed is the characteristic's position. When an inclusion is directly under the table of the diamond it is most visible. An inclusion under the table and positioned close to a pavilion facet will reflect multiple times around the stone, giving this type of inclusion the name "reflector". Reflectors are graded as if each reflection were an inclusion (although in plotting the diamond it is only plotted once). For this reason, reflectors have a greater impact on the clarity grade. Inclusions become less visible when they are positioned under the crown facets, or near the girdle of the stone. These inclusions may often be more easily seen from the pavilion side of the diamond than from crown side of the diamond.

Additionally, the position of large feathers, knots and included crystals positioned where they extend to the girdle or crown of the stone affect the clarity grade. Diamonds worn in jewelry typically will withstand breakage, however inclusions of this nature and in these positions can pose a risk for further extension of the break in the structure of the diamond. Inclusions that are judged to pose at least a moderate risk of breakage to the stone are graded in the Included category.

Nature

The fourth clarity factor which is assessed is a characteristic's nature. The characteristic's nature determines whether it is internal (extending into the stone) or external (limited to the surface of the stone). Internal characteristics automatically exclude the diamond from the Flawless, and Internally Flawless categories. External characteristics exclude the diamond from the Flawless category.

An internal characteristic of a diamond may be classified as a(n): bruise, cavity, chip, cleavage, cloud, crystal, feather, grain center, indented natural, internal graining, knot, laser drill hole, needle, pinpoint, or twinning wisp.

An external characteristic of a diamond may be classified as a(n): abrasion, natural, nick, pit, polish lines, polish mark, scratch, surface graining, or extra facet.

The nature will also determine whether an inclusion poses a risk to the stone. An inclusion that may cause a break in the crystal structure (included crystal, feather, knot, and cleavage) may, depending on its position, pose a moderate level of risk for further breakage.

Color or relief

The fifth clarity factor which is assessed is the color and relief of clarity characteristics. Characteristics that contrast with the surrounding diamond are said to have "relief". The degree to which this color and relief is noticeable affects the clarity grade of the diamond. Colored inclusions invariably show contrast and are more easily seen. An exception is a black pinpoint inclusion, which is often more difficult to see than a white pinpoint.

Rarity and value 

Diamonds become increasingly rare when considering higher clarity gradings.  Only about 20% of all diamonds mined have a clarity rating high enough for the diamond to be considered appropriate for use as a gemstone; the other 80% are relegated to industrial use. Of that top 20%, a significant portion contains an inclusion or inclusions that are visible to the naked eye upon close inspection. Those that do not have a visible inclusion when the gem is examined approximately 6 inches from the naked eye are known as "eye-clean",  although visible inclusions can sometimes be hidden under the setting in a piece of jewelry. The most expensive gem diamonds fall within the VS and SI grades with FL, IF, and even VVS stones commanding significant premiums.   FL and IF stones are sometimes referred to as "museum quality" or "investment grade" to denote their rarity although the term "investment grade" is misleading as diamonds have historically been illiquid and questionable stores of value. 

As many diamond purchases are infrequent, for example an engagement ring, there is a level of concern by end consumers having to pay large premiums for clarity grade differences that are important to the certificate or diamond industry but not to the buying public who cannot discern the difference with the naked eye.

Clarity enhancement 

Laser "drilling" involves using a laser to burn a hole to a colored inclusion, followed by acid washing to remove the coloring agent. The clarity grade is the grade after the treatment. The treatment is considered permanent.

GIA, as a matter of policy, does not grade clarity-enhanced diamonds but it will grade laser-drilled diamonds since it considers the enhancement to be permanent in nature. If you see a GIA Diamond Report with the words "clarity enhanced" or "fracture-filled," it is surely a counterfeit report.

Clarity can also be "enhanced" by filling the fracture much like a car windshield crack can be treated. Such diamonds are sometimes called "fracture filled diamonds". Reputable vendors must disclose this filling and reputable filling companies use filling agents which show a flash of color, commonly orange or pink, when viewed closely. There is a significant price discount for fracture-filled diamonds. The GIA will not grade fracture-filled diamonds, in part because the treatment is not as permanent as the diamond itself. Reputable companies often provide for repeat treatments if heat causes damage to the filling. The heat required to cause damage is that of a blowtorch used to work on settings, and it is essential to inform anyone working on a setting if the diamond is fracture-filled, so they can apply cooling agents to the diamond and use greater care while working on it. The carat (ct) is a unit of mass equal to 200 mg (0.2 g; 0.007055 oz) and is used for measuring gemstones and pearls.
The current definition, sometimes known as the metric carat, was adopted in 1907 at the Fourth General Conference on Weights and Measures,  and soon afterwards in many countries around the world.  The carat is divisible into one hundred points of two milligrams each. Other subdivisions, and slightly different mass values, have been used in the past in different locations.

In terms of diamonds, a paragon is a flawless stone of at least 100 carats (20 g).

The ANSI X.12 EDI standard abbreviation for the carat is CD. 

Etymology

First attested in English in the mid-15th century, the word carat came from Italian carato, which came from Greek kerátion (κεράτιον) meaning carob seed (literally "small horn") and potentially from  Arabic qīrāṭ (قيراط).  
(diminutive of - keras, "horn" )
and was a unit of weight 
though it was not likely used to measure gold in classical times.
The Latin word for carat is siliqua.
This common belief that carat derives from carob seeds stems from the assumption that the seeds had unusually low variability in mass.

However, one group of researchers has found that carob seeds in fact have typical variability compared to the seeds of other species. 

This was not the only reason. It is said that, to keep regional buyers and sellers of gold honest, potential customers could retrieve their own carob seeds on their way to the market, to check the tolerances of the seeds used by the merchant. If this precaution was not taken, the potential customers would be at the mercy of "2 sets of carob seeds". One set of "heavier" carob seeds would be used when buying from a customer (making the seller's gold appear to be less). Another, lighter set of carob seeds would be used when the merchant wanted to sell to a customer.

In the past, each country had its own carat. It was often used for weighing gold. Starting in the 1570s, it was used to measure weights of diamonds.

Historical definitions

UK Board of Trade 

In the United Kingdom the original Board of Trade carat was exactly  grains (~3.170 gr);  in 1888, the Board of Trade carat was changed to exactly  grains (~3.168 gr).  Despite its being a non-metric unit, a number of metric countries have used this unit for its limited range of application.

The Board of Trade carat was divisible into four diamond grains,  but measurements were typically made in multiples of  carat.

Refiners' carats 

There were also two varieties of refiners' carats once used in the United Kingdom — the pound carat and the ounce carat.  The pound troy was divisible into 24 pound carats of 240 grains troy each; the pound carat was divisible into four pound grains of 60 grains troy each; and the pound grain was divisible into four pound quarters of 15 grains troy each. Likewise, the ounce troy was divisible into 24 ounce carats of 20 grains troy each; the ounce carat was divisible into four ounce grains of 5 grains troy each; and the ounce grain was divisible into four ounce quarters of  grains troy each. 

Greco-Roman 

The solidus was also a Roman weight unit. There is literary evidence that the weight of 72 coins of the type called solidus was exactly 1 Roman pound, and that the weight of 1 solidus was 24 siliquae. The weight of a Roman pound is generally believed to have been 327.45 g or possibly up to 5 g less. Therefore, the metric equivalent of 1 siliqua was approximately 189 mg. The Greeks had a similar unit of the same value. 

Gold fineness in carats comes from carats and grains of gold in a solidus of coin. One solidus 24 carats, 1 carat 
 4 grains, is preserved right up to this day. Woolhouse's Measures, Weights and Moneys of all Nations  gives gold fineness in carats of 4 grains, and silver in (pound) of 12 ounces each 20 dwt.

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