Is 24-karat Gold Truly Pure?

The purest commercially available form of gold is 24-karat gold. Highly coveted and valued, 24-karat gold contains virtually 100% pure gold with impurities only in trace amounts. But why does 24k stand apart?

This article delves into the singular attributes of 24-karat gold, from its signature golden colour to its softness and investment value.

Understanding Gold Purity

Gold purity refers to the amount of gold in a piece of gold jewellery or bullion. The purity is measured in karats, which indicates the ratio of gold to other metals in an alloy.

Pure gold is very soft, so jewellery makers blend gold with other metals like copper and silver to increase its durability. Typical gold purity levels are:

• 24-karat gold - 100% pure gold
• 22-karat gold - 92% pure gold
• 18-karat gold - 75% pure gold
• 14-karat gold - 58% pure gold
• 10-karat gold - 42% pure gold

24-karat gold is considered 100% pure gold. However, most gold jewellery and bullion are not made of pure 24k gold. This is because pure gold is incredibly soft and malleable.

To make gold jewellery durable enough for everyday wear, jewellers blend pure 24k gold with other metals to create gold alloys of various purity levels.

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Properties of 24-karat Gold

The high purity of 24-karat gold gives it unique properties compared to lower-karat gold alloys:

Colour: 24k gold is vibrant, rich yellow because it contains no other metals to dilute its natural golden hue.

Softness: Pure 24k gold is incredibly soft and malleable, even “buttery.” It can easily be shaped, pressed, or hammered into thin sheets.

Durability: Because of its softness, 24k gold jewellery and bullion are more prone to scratches and damage without the added resilience from other metals. Pure gold coins or jewellery require extra gentle care.

Value: 24k gold commands the highest market value per unit weight because of its total gold purity. However, the value of lower-karat gold jewellery also depends on artistic design and labour.

Buying 24-Karat Gold

24k gold is available from private mints, gold dealers, jewellery stores, and online retailers. Here are some tips for buying 24k gold:

Certification: Reputable 24k gold should come with a certificate of authenticity and purity from the assayer. This protects against counterfeits.

Refiner: The gold’s mint or refinery should also be a trusted, certified name like PAMP Suisse, Credit Suisse, Sunshine Minting, Valcambi, etc.

Design: For collectable coins and bars, exclusivity and mintage (limited production) makes them more desirable. Beautiful designs also command a premium.

Prices: Prices of 24-karat gold fluctuate daily based on market rates. Check reputable sites like Kitco for live spot prices. Know your dealer’s premiums.

Secure Shipping: Opt for discrete, trackable shipping since gold is valuable. Require signature on delivery. Ensure your purchase during transit.

Storage: Store 24-karat gold securely in a home safe, bank safe deposit box, or insured bullion storage facility. This protects against theft or damage.

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Trading Gold Through CFDs

Contracts for difference (CFDs) provide an alternative way to invest in gold without owning physical bars or coins. With CFDs, traders can speculate on gold price movements.

A CFD is an agreement between a buyer and seller to exchange the difference in gold’s market price between when the contract is opened and closed. For example, if gold trades at $1,800 per ounce when the contract is opened and rises to $1,850 when the CFD is closed, the seller pays the buyer the $50 per ounce price difference.

One advantage of gold CFD trading is that you do not need to take possession of physical gold. This makes entering and exiting positions much faster and easier than buying gold coins or bars.

Leverage is another feature of CFDs. Traders can control much larger position sizes with less upfront capital by using leverage from the broker. For example, a 1:100 leverage ratio allows a $10,000 gold position while only depositing a $100 margin. However, leverage also compounds potential losses, so risk management is crucial.

Is 24-karat Gold a Good Investment?

24K gold has several advantages that make it appealing to investors. With a purity of 99.9%, 24-karat gold coins and bars contain the highest gold content available. This maximizes the intrinsic value per gram compared to lower-karat gold alloys.

24K gold coins from government mints like the American Gold Eagle also appreciate strong collector demand and legal tender status.

For investors focused purely on the value of the gold content, privately minted 24K gold bars and rounds offer the lowest premiums over the live spot price. The high purity and name-brand reputation make 24-karat gold products easier to authenticate and trade.

Always remember that gold prices can be volatile in the short term, requiring investors to have a long time horizon to ride out these ups and downs.

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Conclusion

24-karat gold stands in a league of its own regarding precious metals. Its stunning golden colour, softness, and high intrinsic value give 24k gold an allure like no other. While lower-karat gold alloys have their place for jewellery and some bullion, there’s no substitute for owning pure 24-karat gold bars and coins.

Investors who want to maximize the tangible value of physical gold in their portfolio should consider adding 24k gold coins or bars from trusted refiners.

Trading gold through CFDs can also be an advantageous way to speculate on gold prices without the hassle of physically owning bullion. The speed and flexibility of CFDs enable traders to capitalize on gold’s price swings.

With the right capital, risk management, and trading strategy, CFDs offer leveraged exposure to the gold market that is hard to beat. For traders seeking a more dynamic way to profit from moves in gold, CFDs deserve strong consideration.

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“When considering “CFDs” for trading and price predictions, remember that trading CFDs involves a significant risk and could result in capital loss. Past performance is not indicative of any future results. This information is provided for informative purposes only and should not be considered investment advice.”