Carat is a unit of measurement used to weigh diamond and gemstones. One carat is equal to 200 milligrams, or 0.20 grams. In the common jewelry parlance, carat is also measured in points where 1 carat equals 100 points. Hence a 50 pointer diamond actually weighs 1/2 carat. GIA's alphabet grade has a universal appeal. The scale begins with the highest rating of D for colorless, and travels down the alphabet to grade diamonds with traces of very faint yellowish or brownish hue. The AGS Color Grade indicates where a diamond's color falls on a numeric scale that runs from 0 (colorless) to 10 (light yellow or light brown) in 0.5 increments.
Carat measures weight and NOT size of the stone although both are proportional. A well cut diamond has evenly distributed weight, but a diamond with imperfections in cut, symmetry or proportion tends to weigh the more.
Large diamonds are rare and have a greater value per carat. Price of a diamond rises exponentially to its size. Although the size of the diamond is the most important factor affecting the price, it does not guarantee beauty. So before buying a diamond, first decide upon the quality you want and then choose the size you can afford.