What the Karats in Gold Really Mean: How to Estimate Values

Everyone knows that karats play a big part in determining the value of gold, but most people don’t really understand the karat system and how it works. Unlike the carat weight of a diamond or gemstone, karats measure the purity of gold. Before you sell your gold, it would be a good idea to learn more about how it is valued.

Understanding the Karat System

The Karat System

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Civilizations have measured gold to determine its value for centuries. The value of the karat is believed to have originated in Rome nearly 2,000 years ago. 24 karat gold is the closest thing to pure gold, containing less than 0.1% of other metals. Using this as a benchmark, a simple equation can be used to determine the purity of any gold alloy.

The karat rating is equal to the mass of pure gold within the material divided by the total mass of the object, and then multiplied by 24. This means that a 14K gold ring contains an alloy that consists of 14 parts pure gold and 10 parts other metals like brass, nickel, or silver, resulting in a purity of 58.3%. A 10K ring is made of 10 parts gold and 14 parts other metals with a purity of 41.7%.

How Do Karats Determine Value?

Karats Determine Value

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It makes sense that objects that contain the most gold would have the greatest value. This means that 24 karat gold would be worth the most, while 10K is typically the least pure type of gold available. In most cases, it is safe to assume that an item made of 24K gold would be worth more than the same item made of 18K gold, but this isn’t always the case. There are several other factors that play a part in valuing gold.

Strength and Durability

Gold Strength

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Particularly with gold jewelry, a higher karat rating isn’t always equal to a more valuable item. Gold is a rather soft metal. It doesn’t take much to bend a 24K ring or bracelet. 14K, 12K, and 10K are usually the most popular grades of gold for jewelry that has the potential to become damaged, such as rings and bracelets. This factor doesn’t play a big role in scrap gold, but if you’re reselling your jewelry, pieces made from more durable gold mixtures are often worth more.

Assessing the Color of Gold

Gold Color

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Gold is gold, right? While this may be true, gold alloys can create quite a range of colors. If you’re trying to determine the value of gold based on the amount of pure gold in the object, a rich, deep yellow usually signifies higher karat ratings. Several other hues of gold are just as popular, however. Rose gold, for example, is a mixture of gold and copper that can range from a light pink to a dark red. White gold is often a combination that includes palladium and is typically worth a little bit more than yellow gold.

Gold for Profit

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Whether you’re thinking about reselling gold for a profit or you just want to sell a few pieces of gold jewelry, a basic understanding of how gold is valued can be extremely helpful. Remember that the karat rating is important, but there are several other factors to consider as well.

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