The value of scrap gold, calculated by gold content and weight, depends on gold prices. Those prices can rise and fall like other commodities on the market.
The spot price is based on a process used by the London Bullion Market Association (LBMA) and accepted by gold marketers around the world. Market conditions or supply and demand may factor into the value of gold, according to Scottsdale Bullion & Coin.
Gold items that are melted down become scrap gold and are reprocessed or recycled. Jewelers might buy old jewelry from customers and send the gold to a refinery where it is melted down for the purpose of manufacturing something else, Jewelry Notes explains.
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Gold dealers often buy bracelets, pendants, or broken jewelry from sellers to use the gold content as scrap gold. It is recommended people use reputable gold buyers to sell their gold items, Sell Your Gold advises.
Gold sellers who do their homework and read reviews on dealers will most likely get the best prices for their gold material. Scrap gold dealers usually buy gold items at 60- to 80-percent of the current market value, Jewelry Notes points out.
Scrap gold is typically measured in troy ounces. A troy ounce is equal to 31.1 grams. Gold dealers might also measure scrap gold in pennyweights. A troy ounce contains 20 pennyweights.
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The purity of gold items is also important and identified by the karat system. Pure gold is 24 karats while 18-karat gold is 75 percent pure. Purity can go down to less than 10 karats. Some gold pieces might include silver or copper to give the items more durability.
Gold dealers will determine the value of scrap gold, using the troy ounce and karat method combined with the current market price, but owners of gold can also calculate the value of their gold through kitchen scales or digital gram scales, according to Goldcalc.com.
An online calculator can determine the current market value of gold items for owners who enter the weight of scrap gold and select its purity.
Knowing the value of your scrap gold helps to negotiate with gold dealers for a better price. However, some jewelers might want to buy gold articles based on design or brand and not for scrap, so jewelry owners could receive even a higher price.
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