Fineness of gold

Fineness of gold is described as the ratio between the primary metal i.e gold to the added impurities or base metals to make it hard or give a structure. Fineness is a more modern and accurate way of determining purity and is measured in the units of parts per 1000 and carats or Karats. So 999 actually means 999 parts per thousand. It is also represented as 9990 pure gold. It equates to 99.90% gold purity. Anything above this percentage of purity level is considered as 24 karat gold.

Karats are measured by mass. For 24 grams of gold and all of it was gold i.e. pure, it would be 24 karat. If 22 grams of it was gold, and the remaining 2 grams is copper then the bullion would be 22 karats. Ingots or a bar of gold has some standard specification as to size or weight. A .9999 is highly refined gold which means very small quantity of impurities like silver, iron and copper are added in the total mixture. It is the purest form and only few mints in the world make such Gold bullion/bars with that purity. For example, The Royal Canadian Mint’s Gold Maple Leaf coins are among the world’s premier purest gold bullion on the market.

Standard forms of Gold Purity:

  • 999 – It is the purest gold ever produced and got refined in 1957 by the Perth Mint.
  • 99 – Currently, it is the purest form available and the coins from Royal Canadian Mint contains this fineness.
  • 9 – Canadian gold maple leaf and American buffalo coins are made with this purity.
  • 999 – It is also called as 24 carat gold. Chinese panda coins are generally made with this fineness.
  • 995 – It is the minimum standard percentage of purity allowed in good delivery gold bars.
  • 990 – This type is rarely seen but technically it is still a form of fine gold.
  • 986 – Also known as Ducat fineness. It is seen in historic coins from Venetian and Holy Roman Empire mints, and are still used in modern Austrian and Hungarian coins.
  • 3 (23 carat) – Gold of this purity is often used in eastern jewelry.
  • 916 – (22 carat) It is the most common fineness used in gold bullion coins. At present, the American Gold Eagles, British Soverigns and South African Krugerrands are made with this purity.
  • 900 – Gold containing 10% of other metals are considered as 900 gold. This fineness has found wide usage in Latin Monetary Union mintage. For instance, this standard is used in French and Swiss Napoleon 20 franc coins.

Below this level of fineness, gold is mixed with many alloys of base metals such as silver, copper, zinc etc either to give it a hard structure or make ornamental jewelry.

Facts about gold coins and bars

Generally, pure form of gold is very soft, and hence it is not used for making jewelry and other everyday items. Alternatively, this fine gold is meant for making gold bullion bars and coins. The calculation of gold purity is very important while choosing these bars and coins, because they are mainly used for investment purposes.

Gold bullion coins:

  • Over the centuries, many countries have produced gold coins with different standard forms and fineness. Over the past few years, countries including Britain, Singapore, Mexico, and states of California and Texas have produced several modern bullion coins.
  • Any gold with 99.9% fineness or 24 carats is considered as the purest form but not necessarily the ‘best’. Gold coinage has traditionally been 22 karat or so, because a small percentage of alloy metal such as copper is added to make it strong so that it is less susceptible to wear and damage. For making coins, pure gold is not suggestible because the coin actually circulates from one hand to another in commercial usage and it would get damaged very quickly.
  • In case of popularity, The US Gold Eagle occupies the top position in bullion coins. But when size is considered, the Australian gold Kangaroo coin weighing 1 kilogram i.e., 32.15 troy ounces, or 2.2 pounds is the heaviest gold bullion coin that contains more gold when compared to other coins.
  • Some of the most famous 22 karat gold coins like the American Eagle, Krugerrand, Britannia, and others contain their full stated weight in gold, just like any form of bullion, but have an additional weight in base metal alloy to harden them against wear. On the other hand, gold Maple Leaf, Kangaroo, Panda, and Australian Dragon are some of the sample examples for pure gold bullion coins without alloys.

Gold Bars:

Gold bars that are available in bullion market are classified as two types – Minted bars and Cast bars. Cast bars are produced by pouring gold into a cast whereas minted bars are stamped bars made out of cast bars. Generally stamped bars are more genuine and expensive than cast bars.

There are some standard forms of different gold bar sizes all over the world. The size or weight varies from the smallest 0.3 gram bar (generally used for jewel purpose) to the largest 250 KG bar (owned by Mitsubishi).

  • Kilogold bar: It is the general standard form in European countries and is about 32.5 oz.
  • Tola Bar: It is the most popular unit in Asian countries like India and Pakistan. One tola of gold is equal to 11.33 grams.
  • London ‘Good delivery’ Bar: This is the most standard form of gold bar in many countries. It is 400oz (12.4 Kgs) in weight and is mainly used in banks.
  • Tael bar: This is a Chinese gold bar. It is the standard unit of weight used to measure gold in China. The unit Tael is also used in other countries like Hong Kong, Vietnam and Taiwan.
  • Mitsubishi Bars: Mitsubishi is a Japanese company which is into producing gold bars since 1990. Unlike others, the Mitsubishi bars have only 75% purity.
  • Baht Bar: It is the unit used to weigh gold in Thailand. Bars come in 10 Baht form. 1 baht is 15.244 grams.
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