Colorless diamonds, which are the most common type of diamonds, are graded by color, clarity, cut, and carat weight. These diamonds are sometimes called white diamonds and are graded by the level of colorless to tinted, with the colorless being the highest quality. The yellow diamond, however, is one of many fancy color diamonds that is judged on a different scale.

Natural colored diamonds can be found in a wide range of colors--pink, orange, blue, green, red, and yellow. There are nine categories of color grades for determining the value of fancy colored diamonds--faint, very light, light, fancy light, fancy, fancy dark, fancy intense, fancy deep, and fancy vivid. The value is determined partly by whether a secondary undertone in the diamond enhances or detracts from the main color.

The cut of the fancy color diamond is important in the overall sparkle and intensity of the color. For instance, angles and facets should be used to enhance the best color tone of the diamond. The most popular cuts are princess, oval, and round, but there is also a great demand for various shapes such as trapezoids, hearts, and others.

Clarity is not as important in a yellow diamond as it is in a colorless diamond. In fact, color is more important in the value of a yellow diamond than the presence of inclusions. Most inclusions are unnoticed in a fancy color diamond, especially if it is the same color as the diamond. It is not unusual for an inclusion to be a crystal that takes on the same color as the diamond and actually enhances the brilliance of the stone.