If you own gold and want to sell it, there are a number of things you should be aware of.
The price of gold can vary, depending on how the economy of your region is doing, as well as factors like inflation.
There are a number of ways you can calculate the value of your gold in order to ensure that when you sell it, you’re getting the fairest price.
Most scrap gold dealers keep their method of determining gold’s value to themselves, so you’ll need to know how to calculate it yourself, as accurately as you possibly can.
The following article will break down just how to calculate the worth of gold.
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Things To Know Before Calculating The Worth Of Gold
Before you can try to calculate the worth of gold, there are some things you’re going to need to know, including the weight measurements and values of gold.
The Weight Measurements Of Gold
Gold and other metals that are used for alloying are weighed in troy ounces, but while this is the standard, the units of weight referenced can vary.
It’s believed by many that this is mainly in order to prevent consumers from making their own accurate calculations. Let’s look at the standard measurements.
One troy pound is 12 troy ounces, while one troy ounce is 20 pennyweights. One pennyweight is 24 grains, and 15.43 grains make up one gram. 31.10 grams make up one troy ounce.
If you’re intending to sell gold, you should make note of these equations.
Gold Karat Values
The purity of gold, more specifically the ratio of pure gold to alloy metals, is measured by the karat value (K).
24 karat gold will be 100% pure gold, 12 karat gold will be 12 parts pure gold, and 12 parts alloy metal (so 50% pure gold). To calculate the percentage of pure gold, divide the karat value by 24.
There are a number of online calculators that you can use to quickly determine the value of your gold. These results may not be entirely accurate, but they’ll be close, at the very least.
Websites like MeltValue will ask for the weight of the gold in grams or any other metric, as well as the purity of the gold.
Then, once you’ve inputted your currency, the website will use the live price of gold per troy ounce in that currency, which it will use to calculate the value of your gold.
Some of these websites, MeltValue included, will also feature calculators that determine what price they think you should be selling for, and whether the gold you intend to buy is cheap or expensive.
What’s A Fair Price For Gold?
It’ll be rare that you’ll be offered 100% of the value for your gold, but that doesn’t mean you should be accepting very low offers.
You can use online calculators to find out whether the price they’ve offered to pay is a high percentage of the value or a low percentage.
Bear in mind that the dealer is out to make a profit so they can afford to pay for things like refining costs and staff wages- but some will certainly go with a lowball offer on purpose.
If you’re being offered a price that’s under 60% of the value of your gold, you should not be selling, unless every dealer you can find is offering the same.
Generally, though, you should be able to find a higher offer elsewhere.
If you’re being offered somewhere between 60% and 90% of the value, you might want to consider selling.
If you go to other dealers, there’s a chance they’ll offer you more for your gold- it just depends on how much effort you think the gold is worth.
If a dealer offers you more than 90%, you should probably be taking the deal. This is the closest to a fair price you’re likely to get.
Calculating The Karat Value Of Gold Manually
If the gold you own is scrap gold, there’s a good chance you won’t know enough about it (its karat weight, etc.) to determine its value.
You can work out the karat weight of your gold either by taking it to a gold dealer or by performing an acid test. For an acid test, you’ll need a gold testing kit, or at least the individual parts that will make up an acid test.
These supplies can be bought at jewelry stores, and tend to be fairly cheap.
Most kits will contain bottles of testing acid for 10 karats, 14 karats, 18 karats, and 22 karats. The acid inside said bottles tends to be nitric acid. Also included in a test kit will be a touchstone, or streak stone.
To carry out an acid test, first, rub your piece of metal on the stone, then place a drop of acid right where you rubbed it.
Start with the lowest karat acid, and keep applying the karat acids in ascending order.
When the stone turns brown for, say, 22 karats, but is not affected by the 18 karat acid, then you can assume your piece of gold is 18 karat. The acid that turns the stone brown is one karat above the weight of your gold.
Another method to calculate the karat value of your gold is the Skey test.
For this method, you’ll need to buy a gold tester or gold verification pen that uses the Skey test. You can usually find this equipment for less than 50 dollars, and you’ll be able to perform around one thousand tests.
To perform the Skey test, first, write a quarter-inch line on your gold with the verification pen, and without removing the pen’s tip from the gold, go over this line carefully four times.
Have a piece of white paper on standby before you do this, as your next step will be to immediately draw a line on said paper with the pen.
If the line starts off light brown and turns green, it is under 10 karat. If it remains light brown, it’s 10 karats. If the line remains a dark brown, it’s 14 karats.
Orange means 18 karat, yellow means 22 karats, and if the line is red, your gold is 24 karat. If no line appears, then your metal is not gold.
Once you’ve calculated the karat of your gold, weigh it, and then you’ll have all the information you need to use an online calculator and find out what your gold could be worth.
Conclusion: How to Calculate Gold Worth
All you need to determine the worth of your gold is its purity (or ratio of pure gold to alloy metals), and its weight.
You can then input this information on an online calculator website, of which there are many, and this should give you a good idea of how much your gold is worth. You can also find out your gold’s worth at a dealer’s, but obviously, they’re going to have some bias.