Oct. 9, 2005 -- Diamonds are a $30 billion a year business. You can buy a diamond at the mall, at a fancy boutique and even online. With so many merchants selling them, how can you be sure you're getting a good stone at a fair price?
"Good Morning America" shopped at both ends of the spectrum, buying one diamond ring at Tiffany & Co. for $16,600 and one at Costco for $6,600.
Tiffany & Co.
All diamonds come from deep within the Earth, but there are lots of different places you can go to get one. We started at Tiffany. We had thousands of diamonds and elaborate settings to choose from, starting at $1,200.
Tiffany has a unique policy that allows you to exchange a modest ring for something fancier years later. Tiffany will also clean your diamond and make sure the setting is secure for the rest of your life.
The 168-year-old retailer is famous for educating its customers about diamonds, carefully explaining about the "4 Cs," which are carat weight, cut, color and clarity. The staff will even take you into a private room to examine different stones under a high-powered microscope.
After visiting the store everybody thinks of for diamonds, we went to the store that next to nobody thinks of for diamonds -- Costco.
At the Costco store "GMA" visited, the employee who manages the jewelry department is also in charge of things like big screen TVs and computers.
There were 25 diamond rings to choose from, ranging in price from $500 to $23,000. There's more variety on the Costco Web site, and you can always buy a diamond ring at the store and have it re-set somewhere else.
"We are not really a jewelry store, so we don't carry the best of the best, but we do try to carry top quality," said Juan, the sales clerk who was helping us.
Expert on Tiffany
So, the Costco experience was less romantic. But what about the diamonds themselves? Martin Fuller, considered one of the finest master gemologists and appraisers on the East Coast, carefully analyzed our purchases.
Fuller had good news.
"You got exactly what they said you were getting," he said.
At Tiffany, we had bought a round diamond, just over a carat with very slight flaws and a color grade of "F" -- meaning colorless. We paid $16,600 for it, including the famous Tiffany setting.
Fuller consulted a standardized appraisers' guide and told us the same grade diamond would cost an average of $10,500 at a no-name store, plus additional for the setting. Still, he thought we got a fair price because the special extras that come with the Tiffany name have a value.
"Anything that is brand name and has developed a reputation that Tiffany has developed, they've earned it over the years for quality control," Fuller said. "You can go there [and] you don't have to think twice about your purchase. And you pay for that."
Expert on Costco
At Costco, we bought a round diamond with almost the same specs as our Tiffany diamond. It is just over a carat with very very slight flaws and a color grade of H, nearly colorless. At $6,600, it cost $10,000 less than the similar diamond we bought at Tiffany.
Fuller said the average price for such a stone would be $8,000, a price that doesn't include the setting.
"It's a little bit of a surprise," said Fuller of the high quality of the stone. "You wouldn't normally consider a fine diamond to be found in a general store like Costco, but I'm pleasantly surprised, as well."
"It's a beautiful stone," he added.
Diamond Shopping Tips
No matter where you shop, here are three things to look for to make sure you get what you pay for.
Look for a certified stone.
Buy a diamond that comes with a certificate from the Gemological Institute of America or the American Gem Society. That way, you know exactly what you're getting.
Find out the refund policy.
Make sure the store has a written cash refund policy. Both Tiffany and Costco do.
Get the diamond appraised.
Immediately after you purchase the diamond, take it to a qualified diamond appraiser.
You can also test diamonds yourself using a device that operates on AAA batteries.
Consumer correspondent Elisabeth Leamy used a Presidium Multi Tester that retails for about $250 to test diamonds on "Good Morning America."
The device measures how quickly the gem stone tested cools the heated tips. Because diamonds are the best heat conductors in the world, they cool the tip of the device almost instantly. Other materials like moissanite -- a man-made gem stone with many properties similar to diamonds -- will cool the tip more slowly.
ABC News consumer correspondent Elisabeth Leamy originally reported this story for "Good Morning America Weekend Edition."