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CUT 

The cut refers to the way the diamond was cut and crafted into (i.e. workmanship) of the diamond.  The grader will look at the diamond's proportions, symmetry, polish and facets (each of the multiple surfaces on the diamond).
 
The proportions of the diamond are most important because it affects how light travels through the diamond (sometimes referred to as 'optical performance').  Even the effects of light has its own descriptors: 'Fire' describes the flashes of different colours that come out from the diamond and 'Brilliance' is the overall white light coming from both the inside of the diamond and the surface.
 
The Cut is the only 'C' that depends on the human hand.
4Cs CUT
 
4Cs COLOUR

COLOUR 

All diamonds sparkle only white, right?  Differences in diamond colour are usually visible under a microscope but there is also some colour variation that can be seen by the naked eye.  
 
The GIA colour scale runs from D (colourless) to Z (light yellow or brown).  Diamonds are graded under controlled lighting and compared against a master colour set is used for accuracy and consistency.
 
Truly colourless D diamonds are very rare.  Coloured diamonds, or 'fancies' are also very rare and valuable.  Diamonds can come in shades of pink, red, yellow-orange, green, blue and black.
 

CLARITY

A diamond is formed under extreme heat and pressure and it is rare to find a diamond without any natural features such as tiny fractures or uncrystialised carbon. The clarity of a diamond is determined by its 'inclusions' (inside the diamond) or 'blemishes' (on the surface).  The grader will assess whether any inclusions or blemishes can be seen with the eye or with a 10x loupe (magnifier); and where the inclusions or blemishes are located (near the centre, or the outer edge).  
 
If a diamond is referred to as 'eye clean' this means that no inclusions or blemishes are visible to the naked eye.
4Cs CLARITY
 
4Cs CARAT

CARAT

Carat is the weight of the diamond, not the size.  
 
Large diamonds are rare and a single piece will cost more than several smaller diamonds of equivalent weight or carat.
 
One carat = 200 milligrams of weight.  
 
Diamonds under one carat are divided into 100 points.  
 
75 points = 0.75ct
50 points = 0.50ct (half a carat)