OpenFacet – OpenFacet: A Transparent Framework for Natural Diamond Price Discovery
May 11, 2025
Today we launch OpenFacet — a transparent, data-driven methodology for reconstructing diamond price matrices from public retail listings. Built around GIA-certified, fluorescence-free natural diamonds, OpenFacet enables consistent, explainable pricing across carat, color, and clarity.
The market split between natural and lab-grown diamonds is now definitive. Lab-grown stones have become commodity goods—highly deflationary, low-margin, and unsuitable as pricing benchmarks. Market narratives and pricing integrity for natural diamonds require separation from synthetic volatility.
OpenFacet addresses this by offering a transparent, replicable, and statistically grounded price surface for natural diamonds—reconstructing full matrices from sparse public data with high structural consistency. Built from log-linear regression (for smooth global structure) plus low-rank residual correction (ALS) to capture local effects, the model reconstructs full price matrices per carat band, enforces monotonicity, and updates daily. All inputs are verifiable. No black-box adjustments, no paywalled access.
The DCX Composite Index, built from these matrices, provides a synthetic price benchmark for market analysis, algorithmic trading, and synthetic asset settlement—fully aligned with real-world listings, not opaque dealer channels.
Traditional averages distort diamond pricing, leading to mispriced inventory and index drift. A 2ct stone doesn’t scale linearly—it often costs 3–4× more than a 1ct of the same quality. Prices scale multiplicatively, not linearly. DCX corrects for this by using a geometric mean, the same method used in official inflation metrics like the Jevons CPI. It tracks proportional price movements instead of fixed differences, smoothing spikes from rare, expensive stones.
By applying logarithms, we measure price change in percentage terms—how much a stone gains or loses in value relative to itself—which aligns with how dealers (margin logic), miners (contract valuation), and customers (relative worth) think about the market. The result is a stable, representative index anchored to real retail offers, not anecdotal quotes or auction anomalies.
OpenFacet merely codifies market signal. We’re not shaping the market, we’re exposing it. The industry needs clarity. We built the tool to provide it.