Many articles make reference to the price of gold costing x dollars per “troy” ounce (i.e. ozt). Why is the term “troy” used? And what do the terms “karat” and “carat” mean?
By Lorimer Wilson, editor of munKNEE.com – Your Key to Making Money!
Definition of a ”Troy” Ounce
A “troy” ounce (ozt) is a unit of imperial measure for weight that dates back to the Middle Ages. Originally used in Troyes, France, it is most commonly used to gauge the weight and, therefore, the price of precious metals.
Definition of “Karat”
The term “karat” is used to convey the proportion of gold (i.e. the % purity of the gold content) in a piece of jewellery, coin, ingot or bar as per the table below:
|Karat/Fineness||Gold Content [Purity]|
In some countries “karat” and “carat” are used almost interchangeably although the correct meaning of “karat” refers to the purity of a precious metal (gold, silver, platinum and palladium) whereas “carat” refers to the weight of a gemstone.
100% pure gold is defined as having a purity of 24 karats so if something is 24 karat gold then it’s made of gold and nothing else – regardless of size. Gold is a relatively soft metal and high-karat gold tends to be easily damaged and, as such, a 24 karat item is usually reserved for display or ceremonial use.
All jewellery is required by law to be stamped so consumers will know the quality of gold used.
- Jewelry made in North America is typically marked with the karat grade (10K, 14K, etc.) while
- jewelry made in Italy is typically marked with the “fineness” (such as 417, 583, etc.).
- Most retail gold items have a karat rating in the range 9 to 18.
- In the U.S. the minimum karat value for an item to be sold as gold jewelry is 10.
- In the UK 9 karat is more common.
The number 24 may have originally been chosen to represent pure gold because it divides evenly by 2, 3, 4, 6, 8 and 12 making it easy to talk about a gold item being half pure (12 kt), two thirds pure (16kt) etc.
Never again will you be misled when reading about or considering the purchase of any item in which such terms are (often loosely) used.
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