Imagine celebrating Dhanteras and Diwali in glamor and glitter and then waking up to the news of the massive crash – not in the festive moods, but in the gold rates!
The international
gold prices fell more than 5% on Tuesday in their steepest fall since August 2020, as per a Reuters report. Gold prices carried on with their fall on Wednesday as well, after recording their worst single-day selloff a day prior in over five years.
As of Wednesday, spot gold was down 0.4% at $4,109.19 per ounce, down over 6% its fall from all-time high $4,381.21 touched on Monday. From their record peak of ₹132,294 per 10 grams, gold prices have moderated to ₹128,000 in the domestic market, down by over ₹4,000 or 3%.
With a surprisingly sharp decline in prices, many are wondering if this is the right time to act – whether for gold jewelry or investment gold.
Now, although gold remains one of the preferred assets, especially in Indian culture – for weddings, festivals, savings, and investment – not all gold is the same. The price you pay, the durability you get, and the purity you own – all depend on the “karat” of the gold.
How to decide which one to buy, and based on what factors?
Don’t worry, we’ve got your back.
What are the different karats of gold?
“Karat” (often abbreviated as “k” or “K”) indicates the purity of gold in the metal alloy. Here’s a breakdown of the common types you’re likely to see in India and globally:
24-Karat (24k or 24K): This is considered (nearly) pure gold — about 99.9% gold. Because it has minimal alloy metals added, it retains the richest yellow color and highest value. However, it is also the softest, meaning it scratches and bends more easily.
22-Karat (22k or 22K): This one indicates about 91.7% pure gold. This is very popular in India for jewelry because it retains a bright gold look and is still reasonably durable for wedding and festive pieces.
18-Karat (18k or 18K): This contains roughly 75% gold and 25% other metals (alloys). This one strikes a balance between purity, value, and durability — used often in high-end jewelry, set pieces, etc.
Lower karats (14k, 10k, etc.): These have lower percentages of pure gold (14k is approximately 58.3% gold, 10k is near about 41.7% gold) and more of other metals for higher strength, lower cost. These are very popular choice for everyday wear because it is more durable than 18K gold, especially, 10K being the most affordable and the hardest option, making it a practical choice for durable jewelry.
How to tell them apart
Hallmarking and stamps: Reputable jewelry will bear a hallmark declaring purity (e.g., 999, 916, 750). Always check for the mark on the piece.
Visual and feel differences: While 24K has the deep yellow hue associated with pure gold, it is softer and prone to bending and scratches. Meanwhile, 22K and 18K are marginally less yellow but stronger.
Weight and durability: If you compare two similar looking pieces, the one in 18K or 22K may feel slightly heavier (due to alloy) and may be more robust for everyday wear.
Apart from these attributes, the prices differ as per gold rates. Additionally, a fine jeweler can always tell and explain to you the differences between different karats and will be able to provide you with clarity on karat, the net weight of gold, charges like making charges, and hallmark certification.
How to choose the right one for you
For investment purposes and long-term value: If you are buying pure gold for wealth storage, 24K offers maximum gold content and thus value retention. It’s the best pick, especially when you expect to sell later or hold as a hedge.
For everyday wear jewelry: If you want durability (rings, bangles) where the piece will be worn often, 22K offers a better balance of purity and robustness.
For budget and price sensitivity: For fashionable jewellery,18K can be a practical choice, as it has lower gold content (means lower cost), and the piece will be stronger and less prone to damage.
In addition, it’s always prudent to consider the resale value and market trends before you invest in or buy gold. Higher purity attracts higher value at resale, but battering the piece frequently reduces its aesthetic and thus resale appeal. Furthermore, scheduling purchases around festivals, negotiating making charges, and checking hallmarking are practical steps before the big buy.
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