This guide gives you a clear, no-nonsense breakdown of gold purity, the different measurement systems, and how purity levels affect the price you’ll see in the UK market today.
What Does Gold Purity Mean?
Gold is a naturally soft metal. On its own, pure gold bends and scratches easily, which makes it impractical for most jewellery and everyday use. That’s why it’s usually mixed with other metals such as copper, silver, palladium, or nickel to make it more durable.
Purity refers to the proportion of actual gold in a piece compared to other metals. The higher the purity, the more gold you’re getting and the more it will cost.
How Gold Purity Is Measured
There are two common systems used to measure gold purity: carats (ct) and fineness (parts per thousand).
- Carats (ct): Pure gold is rated as 24 carat. Each carat represents 1/24 of the whole. For example, 18ct gold means 18 parts gold and 6 parts other metals.
- Fineness: Expressed as a number out of 1,000, representing parts of gold per thousand. For instance, 18ct gold equals 750 fineness (750 parts gold per 1,000).
Here’s a quick reference:
|
Carat (ct)
|
Fineness
|
Gold Content (%)
|
Common Uses
|
|---|---|---|---|
|
24ct |
999 |
99.9% |
Investment bullion, coins |
|
22ct |
916 |
91.6% |
Asian Jewellery, Sovereign coins |
|
18ct |
750 |
75% |
Fine jewellery |
|
14ct |
585 |
58.5% |
Mid-range jewellery |
|
9ct |
375 |
37.5% |
UK everyday jewellery |
The Link Between Purity and Price
Gold pricing is based on the spot price of pure gold (24ct/999 fineness). This global market price fluctuates daily, influenced by supply, demand, currency movements, and economic conditions.
When you buy gold in a lower purity, the cost is adjusted according to how much pure gold it contains. For example:
- If the spot price of gold is £50 per gram, then:
- 24ct gold costs £50 per gram.
- 18ct gold (75% pure) costs £37.50 per gram.
- 9ct gold (37.5% pure) costs £18.75 per gram.
However, retail jewellery often comes with extra charges design, brand, craftsmanship, and VAT so the final price will be higher than just the raw gold content.
Why Higher Purity Isn’t Always Better
It might sound logical that 24ct gold is always the best choice. But that’s not necessarily true, especially when it comes to jewellery. Here’s why:
- Durability: 24ct gold is too soft for rings, bracelets, or items worn daily. It bends and scratches easily.
- Practicality: 18ct and 14ct gold are more robust, making them better for everyday wear.
- Price vs. Use: If you’re buying purely for investment, 24ct coins or bars are ideal. But for jewellery, a lower carat often makes more sense.
In short: the “best” purity depends on your purpose – investment or wear.
Gold Purity in Jewellery: UK Hallmarks
In the UK, every gold item above 1 gram must be officially hallmarked to verify its purity. This hallmark is your guarantee that the gold content matches what’s being sold.
Hallmarks typically include:
- The fineness number (e.g., 375, 585, 750, 916, 999).
- The assay office mark (e.g., London, Birmingham, Edinburgh, Sheffield).
- A sponsor’s or manufacturer’s mark.(Who has made or sent the item for hallmark)
This system protects consumers and ensures transparency in the gold market.
Investment Gold vs. Jewellery
If your main concern is value retention or growth, gold bullion and coins are usually the better choice. Here’s how purity plays a role in both:
Investment Gold:
- Always 22ct (916) or 24ct (999).
- Coins such as the UK Gold Sovereign (22ct) and Britannia (24ct) are VAT-free and exempt from Capital Gains Tax (CGT).
- Bars are typically 24ct for maximum purity.
Jewellery:
- Commonly 9ct, 14ct, or 18ct in the UK.
- Carries added value for design, brand, and workmanship.
- Often less profitable as a short-term investment compared to bullion.
Regional Differences in Gold Preferences
Gold purity standards and preferences vary around the world:
- UK & Europe: 9ct and 18ct jewellery dominate.
- India & Middle East: 22ct gold is the cultural norm, especially for weddings.
- China: 24ct jewellery is very popular, often seen as a status symbol.
This matters if you’re buying or selling internationally demand for different purities can influence resale value.
Spot Price vs. Retail Price
It’s important to distinguish between the spot price of gold and the retail price you pay.
- Spot Price: The market value of pure gold, updated by the minute.
- Retail Price: Spot price plus costs of refining, minting, design, marketing, and retailer margins.
For example, a 24ct gold bar will be priced close to spot value, while an 18ct designer bracelet will cost significantly more because of branding and craftsmanship.
FAQs About Gold Purity and Price
- Is 24ct gold always more expensive than 18ct?
Yes per gram, because it contains more gold. But jewellery costs also reflect design and brand, so a heavy 18ct designer ring might cost more than a plain 24ct coin. - Can you resell 9ct gold jewellery easily?
Yes, but resale prices are usually lower because of its reduced gold content. - Why do some countries prefer 22ct over 24ct gold?
Because 22ct balances high purity with better durability, making it more practical for jewellery. - Does gold purity affect investment returns?
Yes. Higher-purity gold (22ct and 24ct) retains more intrinsic value, which is why bullion and coins are usually made from them.
Final Thoughts
Gold purity directly affects price, durability, and investment potential. In the UK:
- 24ct (999) is best for investment bars and coins.
- 22ct (916) works well for coins and some traditional jewellery.
- 18ct (750) is ideal for fine jewellery – good balance of luxury and strength.
- 9ct (375) offers affordability and durability for everyday wear.
When buying gold, always consider why you’re purchasing it. If it’s for investment, aim for higher purity bars or coins. If it’s for jewellery, focus on wearability and style as much as purity.
Knowing how gold purity affects price ensures you get value for money, whether you’re building a portfolio, buying a gift, or investing in a piece you’ll treasure for years.
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