The lack of natural body color is a major factor in determining the value of a diamond. The most expensive are colorless and are graded downward by the amount of yellowish or brownish tint they have.
It is only possible to accurately color grade a diamond if it is unmounted, placed on a white background and compared with a set of standard graded diamonds. A mounted diamond picks up the color the metal and always looks better set in white gold or platinum. Even then, one can only approximate the color of a mounted diamond within a range of a few grades.
The diamond color grades are as follows:
D, E, F: Colorless. Loose diamonds appear colorless.
G, H, I, J: Near Colorless. When mounted in a setting may appear colorless to the untrained eye.
K, L, M: Faint Yellowish Tint. Smaller diamonds look colorless when mounted. Diamonds of 1/2 carat or more show traces of color.
N – R: Very Light Yellowish Tint and
S – Z: Tinted Light Yellow. These diamonds show increasingly yellow or brownish tints and appear very “off-white”.
Diamonds with distinct natural body colors other than brown or black are considered “fancy diamonds” and some bring higher prices than the finest colorless diamonds. A bright red diamond of less than a carat brought almost a million dollars at auction in 1987.
Discerning the difference in color from D down to H in a mounted stone without direct comparison is very difficult. Yet a large D stone may cost three times an H stone of the same weight.
Because of other factors that contribute to the beauty of a diamond, there are many beautiful stones below an M color such as a very light yellow called “champagne” and a darker yellow/brown called “cognac”.
In diamonds over one carat, the color effects the value more than in smaller stones as it is more apparent. But choosing a lower color grade will reduce the price, and there will be little, if any, visible difference when the stone is mounted. (Go next to Diamond Clarity)