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A short guide to valuing or pricing, identifying and appraising solid gold jewelery. What karat ( carat ) is it.?  Market value ? What price should I pay ?  Is it ct or K ? What it’s worth ? What should I sell it for ?  Is it grams or ounces ?  Investment ?  Valuations. New retail versus secondhand, used or estate….

I have 3 other GUIDES on Gold and Jewellery. Check those out for more info on current gold price, Counterfeit and Forgeries, and Gold Plate. Just click on my "Top Reviewer" icon above.

The first thing to say about gold is that it’s like money. Gold has a high intrinsic value and is very liquid....that is, it is easily converted to cash at very near it’s market value. So if you expect to buy gold on an open market well below market value, think again. There are so many people looking for those elusive bargains that it’s very unlikely that you will find one. I know, I’ve tried. Imagine….people selling a $100 note for $60 (Buy now). It don’t happen.

Manufactured jewellery has assorted costs when purchased at the shop. We all know those. Materials (gold, in this case), labour, factory costs, sales and marketing, retail margins, transport, and much more. When this item enters the secondhand market nearly all of those, except the gold value, are thrown out the window. Bear in mind, absolutely NO retailer of new jewellery can afford to sell below gold value and a margin without going broke in a hurry.

To calculate the value of gold you need 3 pieces of information. The karat of the gold, the weight and the price of gold, generally quoted a US$ per ounce. (See your daily news paper for that).

Is it K or ct or just a 3 digit number? The ‘ct’ is interchangeable with ‘K’ for karat. I’m from Australia so we use ‘ct’ like most Commonwealth countries. The term KARAT refers to the fineness of gold. The word CARAT refer to a weight, generally for gemstones. All a bit confusing, but both are OK. The number refers to the fineness of gold in parts per 1000.
There are many karats but below are the most common. The odd ones can be easily be calculated using following.
The 1 karat gold is 1 part in 24 gold. 9ct is 9 parts in 24 gold or  9/24ths or, here comes the best bit…If you multiply 9/24 by 1000 you get 375 gold.  Just look at the following……
8ct or 333 (parts per 1000) or is 33.3% gold (usually east European)
9ct or 375 (parts per 1000) or is 37.5% gold (mainly Commonwealth)
10ct or …actually never seen it a 416 mark but is 41.6% gold (USA)
12ct or 500 (parts per 1000) or is 50% gold (usually old watch cases)
14ct or 585 (parts per 1000) or 58.5% gold (Asian for overseas market)
15ct or 625 (parts per 1000) or 62.5 % gold ( Discontinued c1935)
18ct or 750 (parts per 1000) or 75% gold
22ct  or 916 (parts per 1000) or 91.6% gold (mainly Asia)
24ct or 1000 (parts per 1000) or PURE gold

Gold comes in many colours depending on the other metals used in the alloy. The value does NOT change because of the colour. The amount of gold is the same. White or Rose are just variations.
ALL gold is stamped or hallmarked with its quality. Some marks are lost through wear or repair. If you are buying an unmarked piece of gold make sure you get an unconditional money back guarantee from the seller as to gold carat or the piece.
When looking at hallmarks make sure that certain marks are NOT on the piece. Things like EP, GP, HGP, (Electroplate, gold plate, hard gold plate ) and “rolled”. As the names suggest, these are NOT solid gold. A few other numbers to avoid are 800, 925, 950. These are all silver marks.
Even if it is stamped, there are forgeries. Not many, but some. Most fakes are very heavy. There’s no point in trying to commit a crime for only a few dollars. Just get a guarantee from the seller for your own peace of mind.

The weight is an obvious factor. Generally it’s quoted in grams. There are 31.103 grams to a Troy Ounce which is used for precious metals.

THE CALCULATION……If you divide the price of gold (usually quoted in US$) by 31.103 you get the price for 1 gram of pure gold in US dollars. Convert that to your own currency. Again your newspaper can provide you with the info you need. Once you have a price per gram in your own currency it’s easy to do the last bit. Multiply that number by the percentage gold (see above) and then multiply by the weight in grams. HEY PRESTO….you have the current gold value of the item. IT IS A LOT EASIER THAN IT LOOKS.

So you have the gold value of a piece of jewellery. What’s it really worth?  You will never receive full gold value when you sell to a dealer. He has to have a margin. If you sell to a bullion dealer, you will get very close to that value. From a jeweller or pawnbroker you may get more but most probably you’ll get less. I’m a pawnbroker, I should know.

The above does not consider the fact that most pieces of  gold jewellery are worth more than the metal when you buy estate or secondhand. How much more?…from the buyers point of view as little above gold value as possible. But you do have to factor in…
1. Whether it is a notable piece. You have to research this. (top brand or manufacturer e.g. Tiffany’s)
2. Does it have antique, collectable or historic value. ( I leave that to the Antique Dealers)
3. Condition. If it’s trashed, then it’s gold value only. If it’s like new, you might have to pay a premium.
4. The eye of the beholder. This is the hard one. You can have 2 items with absolutely the same weight and karat. One sells quickly for twice gold weight and one ends up in the melting pot. The difference is that one is ugly and one is pretty. That is were the premium over gold value comes. My experience as an auctioneer and pawnbroker says ‘pretty’ is a very important factor. The prettier, the more bidders, the higher the price.

You see all sorts of claims about the Recommended Retail Price of a piece of jewellery. Some are totally outrageous. I’ve seen somewhere between three and ten times the gold value, quoted as the RRP. To be worth 10 times metal price the piece has to be most exceptional from a famous maker. Realistically 3 to 5 times gold value is about right. The heavier the piece the less per gram as it is easier to manufacture, is a good rule of thumb.
Valuations are a good guide, but a guide only. The are usually done for insurance replacement price. They do not take in consideration things like mass production and discounts etc. They a still very handy indication to the details of the piece, especially diamonds and other gems. The biggest thing they do is give you peace of mind when bidding. They do have to come from a Certified Valuer (in Australia). Not just a piece of paper from a jeweller  making statements about a something they are selling.

Having said all the, the last point to make is that when you are buying gold jewellery seldom are you buying an investment. If you buy close to gold value and the price of gold goes up you could be well ahead. This has happened recently with sharp rise in the price of the precious metal. However, I’m sure there are better investments. Buy gold jewellery for the reason it was made, to decorate yourself. For the joy and pleasure it gives you. Maybe for security. Look good, feel good. ENJOY!

All the above refers to solid gold jewellery without precious gems. As soon as you add precious stones all the above changes.

I have been an auctioneer, secondhand dealer and pawnbroker for 25 years. I hope some of my experience has been of help to you. If it has please press the YES button.
Edward Vabolis 

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