It is a common misconception to state that the best color of the diamond is the one without any color (colorless). In actuality diamonds come in all colors of the rainbow from transparent colorless to ink black one.

The value of a diamond based on its color may be viewed as a curve bell effect. For example a slightly yellow stone is considered an undesirable and will decrease in price. Until of course the yellow color is more distinct in which case the value of the diamond will increase and the color will be considered a fancy color. Here is a visual representation of this analysis

AGS	0	0.5	1.0	1.5	2.0	2.5	3.0	3.5	4.0	4.5	5.0	5.5	6.0	6.5	7.0	7.5	8.0	8.5	9.0	9.5	10.0
GIA	D	E	F	G	H	I	J	K	L	M	N	O	P	Q	R	S	T	U	V	W	X	Y	Z
	Colorless			Near Colorless				Faint Yellow			Very Light Yellow					Light Yellow					Fancy Yellow

Diamonds are graded for color only as loose, un-mounted stones in the inverted position (table down, pavilion up), and under very specific conditions of lighting and background, and also the distance and angle of the observer in relation to the stone.

GIA Color Grading Chart:

GIA	D	E	F	G	H	I	J	K	L	M	N	O	P	Q	R	S	T	U	V	W	X	Y	Z
Terms often used	Colorless			Near Colorless Stones in these grades will face "up" colorless (i.e. slight traces of color not apparent in mounted stones to other the trained eye.)				Faint Yellow Small stones in this range will "face up" colorless when mounted, but larger one will be tinted.			Very Light Yellow Mounted stones in these grades will display a yellowish tint even to untrained eye.					Light Yellow A more obvious yellow tint to the diamond					Fancy Yellow