Karat is the term that is used internationally to indicate the purity of the gold. The karat rate is directly proportional to the purity of the gold. As the karat increases, so does the purity of the gold. The difference between a 24 karat, 22 karat and 18 karat golds are explained below. The 24 karat gold is the purest form of gold that is available. Because of its purity, rather than using it to make jewelry, it is used for investment purposes. The 24 karat gold exists in the form of gold coins or gold bars. The 24 karat gold is followed by the 22 karat gold which is used to make jewelry. The 22 karat gold is a mixture of gold with alloys such as zinc, nickel, or silver. These alloys make the gold harder and fit to be fashioned into jewelry. The purity of the 22 karat gold is 91.67% pure. The 18 karat gold is the cheapest gold that exists. It is a mixture of 75% gold and 25% alloys.
Indians have traditionally used gold for investment purposes. Gold is considered a hedge against financial disruptions. However, when you want to sell gold for meeting urgent financial needs, you should be aware of how old gold jewellery is valued. The right knowledge would keep you safe against unscrupulous jewellers. To calculate the value of gold, you have to take it to the nearest assaying or testing laboratory and get its weight and purity tested. The centre certifies gold's purity in Karat or percentage. To calculate the value of the old gold jewellery by the Karat purity method, you have to multiply the gold's weight, purity, and gold rate and divide it by 24. To calculate the value of the old gold jewellery by the percentage purity method, you have to multiply the gold's weight, purity, and gold rate and divide it by 100.
There are many micro and macroeconomic factors that determine the gold rates in India. Some of the factors that influence that gold rates are: gold production, inflation, government’s gold reserves, demand and supply of the gold commodity in the market, import rates, interest rates, taxes, local demand, etc. Since an unprecedented emergency is likely to arise at any moment, being a resident here, it is good to have an eye on the latest gold rates in cityname. The market price of the gold and the gold valuation offered by the lender is likely to vary. The lender calculates the average gold price of 22-Karat gold according to the rates from the past thirty dates. This is how the lender concludes on the gold gram rate. The value of the gold loan that you get is dependent on two factors – the average gold price and the lender’s LTV (loan to value) ratio. The RBI has also directed the lender to disburse up to 90% of the market value of the gold till March 31, 2021.
Gold derives this value from several factors, some of which are listed below:
Gold, in its elemental form, is a relatively hefty atom. Although it is not the rarest of metals, it isn’t easy to find and extract gold in large quantities. This contributes to its high perceived value.
Gold is a highly coveted metal in a county like India. So, it generally enjoys a high demand all year round, but its supply falls short to meet that. As a result, gold prices tend to increase with time.
One of gold’s many attractive aspects is its liquidity. Gold has an active, reliable and a ready market of buyers at almost all times. As a result, it can be readily converted to cash, which makes it a highly liquid asset.
It is universally accepted as a commodity of value, especially under a free market system. Gold reserves ensure the strength and stability of the currency and eliminate the pitfalls of fiat money.
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