Look for the gram weight. The first step of evaluating whether a gold chain necklace is priced accurately, is to check the gold chain for the listed "gram weight" of the chain. The amount of grams in a chain is the measure of the gold content in the item. Knowing the gram weight of a chain will allow you to compare the amount of gold in the chain with other items from other stores, giving you the perfect tool to "comparison shop". If you are shopping from a traditional jeweler, they should have a jeweler's scale and be able to obtain the weight of the item for you, right then and there. If you are shopping online, the gram weight ought to be listed in the necklace's description, i.e. "This chain weighs approx. 34.0 grams".
Determine the Karat weight of the item (10K, 14K, 18K, etc). Once you have done so, you can compare "apples to apples". A 14K gold chain will weigh more than a 10K gold chain of the same style and size because 14k has more gold content than 10K. Likewise, an 18K gold chain will weigh more than a 14K gold chain.
Obtain the current market price of gold in ounces. You can do so from a gold site, such as kitco.com. For example, as of the writing of this article, the spot price for gold is approx. $1,200 per ounce. Using, the below simple formula, you will need to convert ounces of gold to grams of gold (since gold jewelry is often listed in grams, not ounces. Grams are more manageable when dealing with the average weight of most gold jewelry items): Price of gold per ounce / 31.1 / 24 x KARAT of your item = Base price of gold content per gram of gold. In the below example, plug $1,200 per ounce (today's gold price) into the formula for determining the base price per gram of a 14K gold chain. Other numbers in the formula represent 31.1 grams per ounce of gold. 24 represents 24K which is pure gold and what the gold market value uses, since they are representing the value of 24K gold per ounce. Example: $1,200 / 31.1 / 24 X 14 = $22.50 per gram. What does this tell you? That each 1 gram of 14k gold is worth $22.50 as far as the raw precious metals of gold are concerned. Still following? Go to the last step to find out how it all comes together.
Find your favorite gold chain. In the article example, the gold will be priced at $1,000 and weight 29.0 grams. To determine how much the gold chain is being sold per gram, divide $1,000 by 29.0 grams. The answer is: $34.48 per gram of gold. Using your information from Step 3, you know that the raw price of 14k gold was $22.50. This means that the gold chain is being sold at $11.98 above the price of gold. That is actually not bad at all, considering that there is both labor involved in manufacturing the chain and a modest mark up from both the wholesale and the retailer. Knowing all of this will arm you with the knowledge to determine how much your gold chain is worth and how much above the "scrap value" or "precious metals" value the chain is being marked up. Now you have the tools to compare chain for chain and jeweler to jeweler!
Comments
0 comment