How to Price Gold
Gold can be used in everything from jewelry to dental work. The price of gold is dependent on myriad factors including inflation and interest rates. The challenge is assessing what kind of gold you have in order to gauge relative worth in the market. There are many ways to assess the value of gold. Some gold dealers use the following pricing method.
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Instructions
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1
Separate gold into karat fineness, i.e. 10k, 14k or 18k. Use a magnifying glass to find the inscription. Take it to a reputable dealer if you can't find a number. A chemical test can be used to determine fineness as well.
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2
Determine gram weight using a gram scale. If you have the weight by the ounce, you can convert to grams by multiplying by 28.35. This is the conversion factor between grams and ounces. For instance, 5 ounces equals 5 x 28.35, or 141.75.
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3
Look up the current price of gold. You can use the Internet (see Resources below) or your local newspaper's business section under "commodities." Specifically, you are looking for the "spot rate." Spot is synonymous with "current" in financial parlance. Gold is quoted in terms of a "troy ounce," which equals 31.1 grams. This is a static conversion; that is, it will never change.
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4
Divide the current price by 31.1 to determine the price per gram. For instance, if the current price were $1,000 per troy ounce, the price per gram is equal to "$1,000 / 31.1" or $32.15.
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5
Multiply by fineness (from Step 1). In order to convert the fineness into grams, divide the karat by 24. If you have 10 karat gold and the current price of gold is $32.15 per gram (Step 4), then the price of your gold is $32.15 x .4167, or $13.40 per gram.
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Tips & Warnings
Some dealers use pennyweight instead of grams to calculate price. The conversion rate for pennyweight is 20 per troy ounce, so substitute 31.1 with 20 in the steps above in order to calculate the price.
References
Resources
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