Every piece of gold jewelry has a floor value: the worth of the pure gold inside it. Pawn shops, coin dealers and jewelers call this the melt value, and it's the starting point for buying offers, loan amounts and retail prices. This guide shows how to calculate it for the common karats and gives a worked chart you can adapt to the day's market price.
What karat actually measures
Karat describes how much of an alloy is pure gold, measured in 24ths. Pure gold is 24 karat. A 14 karat piece is 14 parts gold out of 24, with the rest made of other metals such as copper, silver or zinc that add strength and color.
The Federal Trade Commission's Guides for the Jewelry, Precious Metals, and Pewter Industries (16 CFR Part 23) set the rules for how karat is described. Alloyed gold must carry a karat mark right before the word "gold," plain "gold" implies 24K throughout, and the marked fineness can't be more than a few parts per thousand above the actual content.
Gold content by karat
| Karat | Fraction | Gold content | Common stamp |
|---|---|---|---|
| 10K | 10/24 | 41.7% | 10K or 417 |
| 14K | 14/24 | 58.3% | 14K or 583/585 |
| 18K | 18/24 | 75.0% | 18K or 750 |
| 22K | 22/24 | 91.7% | 22K or 916 |
| 24K | 24/24 | 99.9%+ | 24K or 999 |
The "585" stamp seen on much 14K jewelry reflects a European convention of 58.5%. For pricing, using 58.3% is the conservative choice.
The melt value formula
Gold prices are quoted in U.S. dollars per troy ounce, which is about 31.1035 grams. The LBMA Gold Price, the main global benchmark, is quoted this way, as are live spot prices. Jewelry, however, is usually weighed in grams or pennyweights, so the first step is converting. Our guide to grams in a troy ounce covers the conversion in more detail.
Melt value = weight in grams x gold content x (gold price per troy ounce / 31.1035)
Worked example at $4,000 per ounce
The chart below uses a round example gold price of $4,000 per troy ounce, which works out to about $128.60 per gram of pure gold. Swap in the current price to get today's figures.
| Karat | Pure gold per gram of item | Melt value per gram | 10-gram item |
|---|---|---|---|
| 10K | 0.417 g | $53.58 | $535.85 |
| 14K | 0.583 g | $75.02 | $750.18 |
| 18K | 0.750 g | $96.45 | $964.52 |
| 22K | 0.917 g | $117.89 | $1,178.86 |
| 24K | 1.000 g | $128.60 | $1,286.03 |
These are melt values, not retail prices. They don't include refining costs, your margin or any value from craftsmanship, brand or gemstones.
Using melt value in a store
Melt value is a reference point, not a price tag. Most stores use it three ways:
- Buying scrap and estate pieces: offers are typically a percentage of melt to cover refining fees and risk.
- Pawn loans: loan amounts are often set as a share of melt value.
- Retail pricing: a markup on top of melt for finished jewelry, larger for designer or well-made pieces.
Because the gold price moves throughout the day, the dollar figures in your chart go stale quickly. Stores that price a lot of inventory this way often tie their tags to a live price feed so the math updates on its own. For more on setting markups, see how to price gold jewelry.
Check the stamp, then test
A stamp is a claim, not proof. Plated, filled and counterfeit pieces can carry convincing marks. Before paying melt-based prices, test the metal. Our guide on how to test gold at home covers the basics.
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