Dec 2024
Dec 2024
What is Gold Carat?
By StoneX Bullion
Gold carat is a measurement of gold’s purity in an alloy. It is expressed in parts of 24, with 100% pure gold containing 24 carats. Higher caratage means there is more pure gold in an alloy, while lower caratages contain a mix of gold with other metals.
The gold carat system can be used to determine the value, quality, and durability of gold items such as gold bullion bars, gold coins, and gold jewellery. While higher carat gold items are more valuable, they are also less durable and may be less suitable when it comes to everyday use.
In this blog, we’ll help you understand how the gold carat system works, the most common types of gold caratage, the difference between gold carat and fineness, and the caratage of the most popular gold bullion coins.
What is gold carat?
Gold carat (spelled gold karat in the United States) is a measure of gold’s purity in an alloy, expressed as a fraction of 24 parts. Pure gold is classified as 24 carats, which means it is 100% gold with no other metals added. Because pure, 24-carat gold is extremely soft, malleable, and susceptible to scratches, it is rarely used in practical applications such as jewelry. Instead, gold is alloyed with other metals like copper or silver to enhance its durability and change its colour.
Carats are used to measure gold’s purity and determine its value. Lower caratages contain less gold – for example, 18 carat gold is made from 75% gold and 25% other metals, while 14-carat gold is made from 58.3% pure gold and 41.7% other metals. At some point, the gold content in an alloy becomes so minimal that it can no longer be called gold.
Different countries have varying minimum carat requirements for an item to be considered gold:
- In the United States, 10 carats is the legal minimum accepted standard for gold caratage and 14 carats is the most popular.
- In the UK, France, Austria, Portugal, and Ireland, 9 carats is the lowest caratage permitted for an item to be labelled as gold.
- In Denmark and Greece, 8 carats is the legal minimum standard for gold.
The term carat is also used to measure the weight of gems, although the two units of measure are different and should not be confused with one another.
How is gold carat calculated?
Gold carat is calculated by measuring the proportion of pure gold contained in a gold alloy and expressing it as parts of 24. With 18-carat gold, for example, 18 parts out of 24 are pure gold with the remaining 6 containing other metals.
See: Is Gold Jewelry a Good Investment?
History of using gold carats
The use of carats goes back to ancient times, when gold and precious metals were weighed against carob seeds. The word ‘carat’ is itself derived from the Greek word keration which means carob seed. Although they were used to weigh precious metals, carob seeds were not perfectly uniform in size and weight. This led to discrepancies in measurements across different regions and cultures.
The first known use of the carat system denoting the proportion of gold in an alloy was during the medieval period with the German gold coin known as the ‘mark’. The German mark weighed 24 carats equivalent to the weight of carob seeds. Because of the metal’s softness, the mark couldn’t be made from pure gold. To strengthen the coins, other metals – such as copper – were added. The coin’s purity was then expressed as the proportion of its 24-carat weight that was pure gold, marking the beginning of the gold carat system used today.
During the 19th century, discrepancies in gold carat measurements had become a growing issue with the expansion of global trade. In 1907, an international carat standard was established at the General Conference of the Metric Convention. This new standard defined the modern carat as weighing exactly 200 milligrams, a global standard that’s still in use today.
Gold carat vs fineness
Gold purity can be expressed in two ways: carat and fineness. As we’ve learned in this article, the carat system divides gold into 24 parts, with 24 carats representing pure gold. For example, 18-carat gold contains 18 parts gold and 6 parts other metals, making it 75% pure.
Fineness, on the other hand, is a millesimal system that expresses gold purity in parts per thousand. For example:
- Pure gold is represented as 999.9 fineness – equal to 24 carts.
- 22-carat gold, which is 91.6% pure, is expressed as 916 fineness.
Using fineness for gold purity offers greater precision and makes it easier to understand the actual percentage of gold content. It is more common in European countries and is used for hallmarking. It’s usually rounded to a three digit number and expressed without the decimal point.
Learn More: Gold Purity, Fineness, And Karat – What Is It And How To Check It
Does higher carat mean higher purity?
Yes, higher carat gold indicates higher purity, but it doesn’t always mean better quality for every use.
For example, a 24-carat gold item, made from 99.99% pure gold, is considered the most valuable in terms of gold content. However, its purity also means it is soft and susceptible to damage. This makes it unsuitable for gold jewellery as it will scratch and bend easily.
Lower-carat gold, on the other hand, combines gold with other metals to enhance its strength and durability. This makes lower-carat gold jewellery items stronger and more appropriate for everyday wear.
Generally, 18-carat gold is the most preferable when it comes to jewellery. It still contains a relatively high amount of pure gold but balances that with durability. When it comes to gold investment, such as gold bars and gold coins, 24-carat gold is the preferred choice. Since these types of gold are not meant to be handled frequently, the higher purity adds more value to the investment without compromising practicality.
Keep Reading: Why Buy Gold? Reasons to Invest in Physical Gold Bullion
Most common gold carats
Gold comes in various caratages, with each representing a different level of purity, durability, and suitability for different purposes. Below are the most commonly used gold carats.
24-carat gold - 100% pure
24-carat gold is the purest form of gold, made from 99.9% pure gold and only small traces of other metals. It is the most valuable type of gold available and reserved for gold bullion bars and coins and certain medical or electronic applications.
Because it is so soft, 24-carat gold is not suitable for most types of jewellery as it can easily scratch or bend. It is, however, used for wearable gold bullion jewellery.
22-carat gold - 91.67% pure
22-carat gold is made from 22 parts gold and 2 parts other metals, usually copper, silver, zinc, or nickel. This type of gold has a rich, yellow hue and is more durable than 24-carat gold. That said, it can still be malleable and prone to scratches and wear.
You’ll often find 22-carat gold used in jewellery that doesn’t require intricate settings, as its softness makes it unsuitable for holding gemstones securely. It's also used for certain gold bullion coins, such as the Gold Krugerrand and Gold American Eagle.
18-carat gold – 75% pure
18-carat gold is made from 18 parts gold and 6 parts other metals. This type of gold strikes a balance between durability, purity, and affordability. It still has a rich, yellow tone but with a slightly duller shade.
Because it is more scratch-resistant, 18-carat gold is commonly used in jewellery designed for everyday wear, such as watches and wedding bands. It is still relatively malleable which means it can be worked into intricate designs, making it popular for diamond jewellery.
14-carat gold - 58.3% pure
14-carat gold is made from 14 parts gold and 10 parts other metals. This type of gold is more affordable and durable than higher-purity options, but also has a pale yellow tone that some consider less desirable. You’ll often find 14-carat gold used for casual jewellery pieces such as bracelets and necklaces.
10-carat gold - 41.7% pure
10-carat gold is the least pure, made from 10 parts gold and 14 parts other metals. It is highly durable, which makes it common for use in simple chains and rings. 10-carat gold is much paler than other types of gold and can tarnish more easily. Because it contains more metals, it can cause skin irritation for those with metal allergies.
Keep Reading: How is Gold Formed and Where Does it Come From?
How many carats is a gold bullion coin?
The caratage of gold bullion coins varies depending on the type of gold coin. The purest gold bullion coins, made from 99.99% pure 24-carat gold include the Canadian Gold Maple Leaf, British Gold Britannia, and Vienna Gold Philharmonic. Other popular gold coins include the Gold Krugerrand and American Gold Eagle, both of which are made from 22-carat gold of 91.67% purity.
The below table compares the most popular gold bullion coins and their purity.
GOLD BULLION COIN | CARAT | GOLD PURITY |
22 carat | 91.67% | |
22 carat | 91.67% | |
24 carat | 99.99% | |
24 carat | 99.99% | |
24 carat | 99.99% | |
24 carat | 99.99% | |
24 carat | 99.99% |
See More: What are the Best Gold Coins to Buy and Why? From Kruggerands to Maple Leafs
Buy investment-grade gold bullion today
Whether it’s 22-carat or 24-carat, gold is a metal with intrinsic value that has retained its worth for centuries. If you’d like to tap into the enduring value of gold, the best way to do so is by investing in investment-grade gold bars, coins, or wearable gold bullion.
At StoneX Bullion, we stock a wide range of gold bullion, including the highest-purity gold bullion bars and coins from the world’s most prestigious mints. Browse our collection and start preserving your wealth with the timeliness of gold today.