Bullion Buying Index

Welcome to our Gold Bullion Buying Index. Here you will find information about types of gold bullion, their properties and their purposes.

Hallmarking

The UK has a long history of legally required hallmarks for both gold and silver. Currently all UK gold items over 1g must be hallmarked. There are three compulsory marks. They are the maker or importer’s mark, the assay office mark and the gold purity.

Traditionally the gold mark is contained in an eight-sided shape. The UK also recognises international convention marks. These are contained in two circles with weighing scales.

Measuring purity

Pure gold and silver are naturally soft and malleable metals. For virtually all practical applications, gold must be mixed or alloyed with other harder metals. Therefore, most items referred to as gold are not pure gold, but alloys. Because of the high cost of gold, it is then important to know what proportion of precious metal has been used, to make an accurate valuation.

There are two commonly accepted units that measure the purity of gold. They are carat – or karat in the US – and the international millesimal system, or fineness.

Carat measures purity in parts of 24. Therefore 10-carat gold is 10 parts of gold to 14 parts of other metals.

Fineness measures the gold content in parts of a thousand – 999.999 being pure gold.10-carat gold then would be equal to 416 fineness. As a percentage it is 41.6% gold.

Below you can find a table displaying each type of gold, their purity and their fineness.

Purity in relation to purpose

When it comes to carat rating, the higher the carat, the more expensive the gold. This is because carat rating relates directly to purity. For example, 9-carat gold is 9/24 parts pure gold, whereas 22-carat gold is 22/24 parts pure.

Investment gold is generally struck in 24-carat or 22-carat. 24-carat gold is used only as raw material or for bullion investment, as it is far too soft for wearable jewellery.

When buying jewellery, the choice of fineness is a balance between value and durability. High fineness jewellery has greater value and is more tarnish resistant. Lower fineness jewellery, like 9-carat and 10-carat, are more affordable and more hard-wearing, but may tarnish.

By comparison, 22-carat is more easily damaged, more resistant to tarnish but also more expensive. This means 9 and 10-carat gold are popular choices for affordable jewellery and gold items that likely to get worn down.

9, 10, 18 and 22-carat gold are most commonly used in the UK.

White Gold, Yellow Gold & Rose Gold

The metals used in gold alloys change its gold colour or tint. Various alloys have a huge range in shades of gold. The three major shades are white, yellow and rose.

White gold can be made with zinc, palladium, silver and/or nickel. It can also be made by rhodium plating gold – this gives it an extremely hard, pure white finish. Yellow gold is an alloy of silver and copper or zinc. Rose gold is made by alloying with more copper than silver, giving the metal a redder tone.

9-carat Gold

9-carat gold is an alloy encompassing 37.5% pure gold, while the rest is made up of other metals.

Typically, 9-carat gold will be made of 37.5% gold, 42.5% silver and 20% copper. However, it is also possible to find slight variations on this combination to create the different colours mentioned above. 9-carat white gold, for example, is made up of 37.5% gold and 62.5% silver. 9-carat rose gold, on the other hand, has a higher copper content.

Due to being mixed with other metals, 9-carat gold is harder than pure gold, which is why it is a popular choice for jewellery.

10-carat Gold

Currently 10-carat gold is not a commonly used purity in UK jewellery. It is more common in the US, where it is the lowest permitted purity of US gold jewellery. 9-carat is more common in the UK and is the lowest purity allowed.

Due to the growth of international online shopping, 10-carat gold pieces of jewellery are becoming more common in the United Kingdom. 10-carat, like 9-carat, is not regarded as fine jewellery.

14 Carat Gold

14 carat gold is 14 parts of gold, to 10 parts of other metals, therefore equal to 583 or 585 fineness. As a percentage this would equate to 58.5% pure gold.

Also, a popular choice for jewellery,14 carat gold is used for the more middle-range valued pieces, compared to the lower value 9 and10-carat.14 carat gold is a good compromise between value and durability, but it is not common in the UK compared to the US. However, like 10-carat, 14 carat gold pieces are becoming more common in Britain with the growth of e-commerce.

Working out how valuable 14 carat gold can be done relatively easily. Its worth depends ultimately on the gold market spot price, which is based on pure 24-carat gold. The 14-carat gold value can be worked out by multiplying the spot price by 0.583 or 0.585.

18-carat gold

18-carat gold is a relatively high purity of gold, with 18 parts of gold to six parts of other metals. This type of gold is used for making high value jewellery, and is regarded as the top quality for jewellery in the US.

18-carat gold is equal to 750 fineness, or 75% gold. It is still relatively soft due to its high purity but is still suitable for jewellery that will not be worn every day, like gold engagement rings and bracelets. It is also a good choice for items, like necklaces and earrings, that are not exposed to knocks and bumps.

18-carat gold is the third-most expensive gold alloy. Working out the price of 18-carat gold is fortunately very simple. By multiplying the current spot price by 0.75, you will get a rough 18-carat gold price. It should be noted however that the cost to refine and process 18-carat gold means you will usually get a price below this calculation.

22-carat Gold Purity

22-carat gold purity is equivalent to 916.7 fineness, or 91.67% pure gold.

22-carat gold is a popular purity for older/traditional coins. If pure gold had been used for circulating coins, they would likely have been damaged and become misshapen over the course of their use. Instead, mints would mix the gold with a small number of other metals (often copper) to help make the coins tougher and withstand the rigours of use.

The Royal Mint’s Sovereign is a perfect example of this. A 22-carat gold coin was originally made up of gold, silver and copper. Modern Sovereigns however use just gold and copper, giving the coins a reddish-gold hue. Even though the Sovereign is now used as a bullion investment coin only, the mint holds to tradition and continues to strike it in 22-carat gold.

The Royal Mint also produced the one-ounce Gold Britannia in 22-carat gold from 1987 to 2012. From 2013 onward however this was changed to a full 24-carat.

The South African Krugerrand also uses 22-carat gold and has done since its first issue in 1967. In the US, the American Eagle is also a 22-carat gold coin – the US mint produces the Buffalo as a 24-carat alternative.

24-carat Gold Purity

24-carat gold is considered the purest possible gold available. If an item is referred to as 24-carat gold, then this means it is – for all intents and purposes – pure, with 24/24 parts being gold. This is occasionally used for gold jewellery but is generally too soft for anything that might be used regularly.

The purity of 24-carat gold is .999 fineness, or above. Creating 100% pure gold is not technically feasible, so 99.9% fine gold is considered ‘pure’ gold. The highest purity of gold created was by Australia’s Perth Mint, and was 99.9999% – ‘six nines’ fineness. This is 0.0001% shy of being entirely pure gold.

In the UK, the Royal Mint’s Gold Britannia coin is one of the most popular 24-carat gold coins, produced to 999.9 fineness. This is also true of the Royal Mint’s Lunar and Queen’s Beasts coins, which are also 24-carat gold. As mentioned above however, The Sovereign, holding to centuries of tradition, is produced in 22-carat gold.

The ‘six nines’ fineness may have proved too costly for mass production, but Perth Mint still maintains a focus on pure gold coins, and the Australian Gold Nugget is struck from 24-carat gold.

The Canadian Royal Mint also produce their Maple coin series in 24-carat gold and have something of a rivalry with the Perth Mint. So far, the Canadian Royal Mint have managed to refine their gold to a purity of ‘five nines’ – 99.999% – and use this regularly for commemorative coins.