New York, Sept. 1 (Bloomberg) -- A marriage proposal can be stressful enough without high-pressure salesmen pushing diamond rings costing thousands of dollars at you. Daniel Ownby, 30, who runs a Houston, oil and gas marketing firm, found a way to avoid the salesmen and make buying an engagement ring less emotional and more of an objective process, while saving money, too. He did this by learning about diamonds and buying one from a jeweler on the World Wide Web.

Ownby used an Internet search engine to locate several Web sites devoted to diamonds that explain the grading system used to compare quality among stones. The sites include two operated by trade groups: gia.org, run by the Gemological Institute of America based in Carlsbad, California, and ags.polygon.net of the American Gem Society in Las Vegas. "If you are going to put $10,000 into a stock, you'd want to know more about what you are buying," Ownby said. "A diamond's no different, it's an investment."

DiamondTrade.com, is a Dallas-based Web site offering GIA- certified diamonds for sale. "Even if a consumer had the notion to go to a traditional store in a mall to do their shopping, with so little time nowadays, they are going to do the investigative stuff on the computer," said Dan Morehead, president of DiamondTrade.com., who began his career as a diamond sorter at Zale Corp., the largest U.S. jewelry retailer. "Consumers used to come into a store looking for a diamond and say, `I want a pretty one.' That doesn't happen any more."

Beating 47th Street

When it comes to price, there are few bargains at traditional jewelry retailers, such as Tiffany & Co., Cartier, Harry Winston, and even Zales, which has something for everyone's budget. These stores, because of their higher overhead, can't beat the prices of Internet retailers.

Even merchants in New York's diamond district on West 47th Street, where haggling can lead to prices a third or more below those of the big retailers, are undercut by Web-based jewelers.

The proliferation of Web sites offering diamonds for sale comes as steady growth in the U.S. economy and a bull market for stocks has encouraged more spending on luxury goods. U.S. diamond jewelry sales rose 9 percent to $22 billion last year, according to the Diamond Information Center in New York. The average amount spent on diamond engagement rings was $2,000 in 1998, up 11 percent from the $1,803 in the year before.

The emergence of Internet jewelers is so new that precise sales information for the group isn't available. Getting consumers to overcome fears of buying expensive gems, sight unseen, has been a challenge for the retailers on the Web. "Most buyers ask, `how do I know you'll send me a real diamond?," Morehead said. DiamondTrade.com ships gems by registered mail or overnight delivery with certificates detailing each stone's grade by the GIA, and a 60-day refund policy. Other Internet jewelers operate similarly.

The Four C's

Buyers needn't take an Internet jeweler's word for the quality of a diamond. The sellers encourage buyers to have the gems re-appraised by a gemmologist or independent jeweler.

A diamond's value is determined by the interplay of "the four C's," or cut, clarity, color and carat weight.

The shape of a diamond's cut can improve the gem's capacity to reflect light, which enhances it's brilliance.

Clarity refers to the presence of natural flaws, known as inclusions, in the stone. The fewer inclusions, the less they interfere with the passage of light through the gem and the brighter its sparkle. Grades for clarity, based on the number flaws in a stone, range from flawless or "FL," the highest grade, to "I" or imperfect.

Diamonds come in a range of colors from rare pinks and blues, known as "fancies," to light yellow, the least valuable. Color is graded from D to Z. Colorless diamonds, falling within grades D through F, are the most valuable, then come the "near colorless" group of stones that are sold by many top retailers. These stones have grades from G through I.

Carat weight is the standard measure of a diamond's size. Diamonds aren't very big -- a carat is one-fifth of a gram.

A Pea-Sized Diamond

The price of a one-carat solitaire diamond sold by Tiffany, about the size of an English garden pea, with a clarity of `VS1' and a color-rating of "I," the lowest grade that the company sells as a solitaire, starts at about $10,000, a spokeswoman said.

The diamond that Ownby gave his fiancee has a color grade of D, and a clarity grade of VVSI, or "very, very slightly included," which is just below flawless. "I'd go into stores, like Tiffany or Bailey, Banks & Biddle and they'd try to sell the ring and not the diamond, and really the setting is the least important thing you have to worry about," he said.

Of course, there are risks to buying anything over the Internet. The expansion of online shopping led the Federal Trade Commission in Washington to publish guidelines for consumers to follow -- "Online Auctions: Going, Going, Gone!" and "Shop Safely Online" -- are available on the FTC's Web site at www.ftc.gov. "You can get a good deal on the Internet, but you must exercise caution," said Robin Rosen Spector, an attorney in the FTC's Enforcement Division. "With sales of gems on the Internet, if it looks too good to be true, it probably is."

Rosen said consumers should verify the seller's identity when planning a purchase, check out the return policy, and arrange to pay for the gems by cash on delivery or with a credit card. "If you can't see or touch the item you are buying and aren't satisfied when you receive it, you need to ensure that you can get your money back," Rosen said. "It may take the romance out of shopping for things like diamonds, but it's smart to be cautious."