Understanding Gold Pricing
What is the "spot price"?
The spot price is the current market price for one troy ounce of pure (999) gold, set by global trading on exchanges like COMEX and the London Bullion Market. It's the reference price this tool converts into grams, tolas, and kilograms across different purities and currencies.
Karat purity explained
Pure gold (24K) is soft, so it's alloyed with metals like copper and silver for durability. The karat number tells you how many parts out of 24 are gold:
| Karat | Purity | Common Use |
|---|---|---|
| 24K | 99.9% | Investment bars, coins |
| 22K | 91.6% | Traditional jewelry (South Asia, Middle East) |
| 21K | 87.5% | Middle Eastern jewelry |
| 18K | 75.0% | Fine Western jewelry |
| 14K | 58.3% | Everyday jewelry, durability-focused |
| 10K | 41.7% | Budget jewelry (US minimum standard) |
Grams, tola, and troy ounce
Different regions use different weight units for gold. A tola (≈11.6638 g) is the standard unit across Pakistan, India, and the wider South Asian and Gulf markets. A troy ounce (≈31.1035 g) is the international standard used for spot pricing worldwide.
What affects the price you pay
- Spot price: the base global market rate, driven by supply, demand, and currency strength.
- Making charges: labor cost added by jewelers for crafting jewelry, usually a percentage or flat fee.
- Import duties & taxes: vary significantly by country and affect the final retail rate.
- Purity: lower karat gold costs less per gram than 24K, since it contains less actual gold.