A Guide to Buying Gold
Understanding gold terminology, its origins and usage is simple. Let’s start with some lay definitions of commonly heard terms.
PURE GOLD…99.9% gold. Refined to purge it of impurities. It is very soft and of no practical use in the fabrication of jewelry. It is used for some coinage and specialty mint pieces. This is referred to as 24-Karat gold. Incidentally, it takes 350,000 ounces of gold bearing rock to produce one ounce of pure gold. That’s ten tons!
REAL GOLD…A term that is “generally” used to distinguish gold that has a particular karat throughout as opposed to a film or plating over some other metal. Also…SOLID GOLD.
KARAT…Refers to the amount of gold content in a “gold” item. As an example, let’s take a quantity of pure gold. It is referred to as 24-karat. Let’s flatten it into a square, and score it like pieces of a Hershey Bar. We divide it into 24 equal portions. We break off six segments of the gold (25%) and replace them with equal portions of another metal, zinc for instance. We melt this altogether to form an alloy. Since this new creation is now only 18 parts gold (75%), we refer to it as 18-karat. So when referring to any gold karat we are really telling the world what portion of the alloy is gold in relationship to the whole. These terms have metric equivalents more commonly used in other parts of the world. Listed below are the ones most likely to be seen. Their metric counterparts are included, along with some common uses.
24-Karat (999) Coins and electronics.
22-Karat (917) Coins, electronics and Baht jewelry.
18-Karat (750) Fine jewelry, not designed for everyday wear. Popular in the Middle East and Asia.
16-Karat (667) Seen exclusively in dental applications.
14-Karat (585) Jewelry: especially in the United States. Provides good looks and durability.
10-Karat (417) Jewelry: economical and popular for every day wear because of its strength.
9-Karat (371) Minimum legal standard in Canada.
8-Karat (333) Minimum legal standard in Mexico.
PLATED…Gold that has been applied to the surface of another metal using an electrical process. Generally distinguished on factory produced items with the letters GE or HGE (Gold Electroplate or Heavy Gold Electroplate )
ROLLED…Gold that has been applied to the surface of another metal using a process that does not require electricity. Most often seen on older watches, the process usually involves great pressure. The thickness of the gold is usually indicated in fractions of microns. 1/10th or 1/20th is most common.
FILLED…Similar to rolled.
BAHT…A form of currency in Thailand, like dollar or peso, or mark. In gold form, it is normally 22-karat rectangular shaped pieces, linked together forming a chain. The size of the links and the length of the chain determine the value. Imagine 100 pennies, 20 nickels, or 10 dimes strung together. They would each equal one dollar, but their length would vary dramatically. You could create a five or ten dollar chain too, but certain size coin chains would prove more practical for some denominations than others would. So it is with baht gold. Or so it was. Baht chains are still popular, but the term has in recent years become corrupted. Catalogs now sell “Baht” jewelry in forms that have little bearing on the original term. More likely it now becoming synonymous with 22-karat gold. Baht gold is almost never used with precious gems, because it is too soft. Lacquers are often applied to flat surfaces to provide beautiful contrasts in color and texture.
FOOLS GOLD…is not gold at all. It is a gold colored mineral found in other rocks like gold often is. It is really iron pyrite and in relation to gold is worthless.
“THE ACID TEST”…This is an expression that has entered popular language and means the final proof, or undeniable. It comes from the need to be able to quickly and positively determine not only if an item is truly gold or not, but also what karat it is. One of gold’s enduring qualities is that it does not tarnish or oxidize easily. Nitric acid does affect gold and when applied in different concentrations, can provide nearly infallible answers to questions of karat.
“P”…The letter “P” may be found following the karat designation on a jewelry item, i.e. 14KP. This stands for the word plumb, which in this instance is an indication that the gold content is no less than 14-Karat. An item may be legally stamped with a karat designation as long as it is within a specific range, but to carry the “P”, it must be no less than what is stamped on it.
GRAMS VS. PENNYWEIGHT (g. vs. dwt.)…Two ways (no pun intended) of weighing small, usually valuable items or where a fractional amount might be important. This would be true of jewelry and pharmaceuticals, probably the most familiar applications. A pennyweight is equal to 1/20th of a troy ounce. A gram is equal to 1.555 pennyweights. Most scales designed to function within these low ranges are easily switched from one to the other. A pawnshop owner will use whichever is found to be most convenient.