When you imagine buying an engagement ring, do you envision sitting at the local jeweler discussing color and clarity like the old days? These meetings may become a thing of the past if a pair of young hedge fund managers have anything to say about it. Devin Jones and Jason Modica, the team behind StoneAlgo.com, are introducing a new way to find the best diamond for your engagement ring, and they’re doing it with cutting edge machine learning algorithms and agreements in place with the world’s top online jewelers.
The team has extensive experience creating algorithms to value risky securities and options at their hedge fund, Cold Harbor Capital. The two entrepreneurs first met at Bank of America in 2011 and soon began working to solve real world problems using the tools and techniques they were applying to the derivatives markets. After searching for investment products that aligned with their core philosophies and coming up empty, the pair decided to leave the major U.S. bank and launch a hedge fund focused on protecting and growing their clients’ nest eggs using a proprietary trading strategy whose secret sauce is protection against future stock market crashes.
Today the team continues to push the envelope as they develop new tools and strategies for making every day purchasing decisions more straightforward. StoneAlgo represents their first foray into free, consumer facing tools that bring cutting edge technology to the masses through a simple and intuitive interface.
“The goal was to give buyers the tools they needed to make better decisions. We thought, ‘if this is something that can save people time, money, and stress, and if no one is currently doing it well, we need to pursuit this seriously’”, recalls Devin Jones.
The algorithm was conceived one rainy, Friday afternoon as Devin rushed home from Manhattan’s Diamond District on 47th Street. As he remembers it, “I had already been to a local family jeweler and felt confused by the prices they were showing me – that feeling was even worse in the diamond district. I was fortunate to have a personal introduction to a dealer who claimed I was seeing the lowest possible prices in the market. However, he showed me diamonds that were either of lower quality than I was willing to consider or smaller than the carat size I was targeting, and I still had no idea if the prices were actually good or not.”
When Devin arrived back at work he immediately brought his business partner Jay in on the project. The goal: to create an algorithm that could price any GIA certified diamond based on the live prices available in the online market, and also identify the most undervalued diamonds for Devin to consider. It worked like a charm. Within weeks Devin and Jay finished an algorithm that recognized significant buying opportunities, and soon after Devin secured a diamond that the algorithm estimated was worth 50% more than his maximum budget, but was still priced just below his max spend.
“It felt like something was wrong with the model when I first saw how undervalued the diamond was, so I called around and asked jewelers if they could show me a price on a diamond of that quality and they came back with quotes that were more than 50% above what I was able to pay. I requested images and videos of the diamond which came back clean, so I bought it almost on the spot and I had it in my hands a couple of days later.”
Today the team is focused on delivering their algorithm to consumers in an easy to use web app that presents the best diamonds from some of the world’s top online jewelers. The site does not accept credit cards or carry inventory, but instead acts as a way for buyers to evaluate the prices at a number of top online jewelers. When a user is ready to buy a diamond they simply click a link that takes them to the jeweler’s own website in order to complete the transaction. “We’ve got a lot of plans in the pipe that we think can help bridge the gap between searching online and seeing diamonds in person,” says Jay. “The industry continues to evolve and we want to make sure we’re helping to drive it in a more transparent direction.”
Shopping for diamonds is confusing. Our Diamond Comparison Report is here to take the guess work out of your buying experience, allowing users to input up to four diamonds and compare them side by side with helpful insights to light the way. Our advanced cut quality algorithm will figure out just how perfectly each diamond is cut and recommend the best diamond from your list while highlighting any potential concerns (like problematic types of inclusions that are noted on the GIA report). In seconds you are able to analyze an insane amount of raw data and even see our top recommendations based on the diamonds you are currently comparing. It's the diamond shopping tool we wished existed when we did this dirty work for ourselves. Enjoy!