StorageUnitAuctionList Tips: A Concise Guide to Self-Appraising Gold
What does Ron Paul mean when he talks about “getting back to the gold standard?” Well, other than being a cute, elfish little idealist at times, gold and other metals used to be the objective standard by which to measure an economies wealth. This is mostly due to the fact that coins in Europe and early America were actually minted from gold and silver. Although this is no longer the case, because it is a useful, rare substance, gold still retains its value, worldwide, especially in a down economy.
It’s not every day, but you may find random assortments of scrap jewelry in your newly won lockers, gold included. What do you do with it? How may you arm yourself against a pawn shop trying to lift your glittering prizes off of you for next to nothing? Storageunitauctionlist.com has answers.
In truth, these kits cost very little ($35, maximum) and can be a great investment as you get deeper into the gold resale niche market. The primary product in the kit is an assortment of bottles of acid of varying strengths, corresponding to Karat value of any given piece of gold. They should range from at least 10K all the way to 24k. Spending an extra fifteen dollars for the deluxe pack ($35) will get you a digital scale as well, which is really imperative to have in deriving the overall value of the weight you have acquired. A filing surface is what rounds out the kit.
How To Work The Kit
The objective of using the kit is to determine the Karat concentration of your gold pieces, which is essentially the percentage of pure AU they consist of. Here’s the process:
- Take the bracelet, ring, or necklace and, and in an area that is less conspicuous, you’re going to file into the item until it leaves a visible streak on the pad. We really recommend doing so twice in order to get slightly beyond the surface, which may be plated and a misrepresentation of the internal Karat value. Don’t rub too hard. You can always use a gold polishing product or a cloth to rub away the scuffs later. If you plan on selling the gold wholesale to a smelter or wholesale collector, the smudge will not decrease the value anyway. Just be easy on it.
- Start with the lowest acid tester and pour a small amount onto the bottom section of the sample. The idea here is that whichever acid begins to alter and lighten the appearance of the sample will be higher than the Karat value of the piece. Work your way up the sample until it begins to fade.
If the 14k tester only begins to wear on the sample ever so slightly, then the piece is not 14k, but 10k. It is important to get a strong, pronounced sample so that you can tell beyond a shadow of a doubt that the gold coloration has changed due to the acid, not the weakness of the streak.
Using The Kit to Calculate Value
After testing all of your pieces and determined their Karat-age, separate them into piles. Next, check this website, a live, updating chart of gold value by "Troy Ounce," a rate that changes daily with the stock market, though not drastically.
Let’s just pretend that today a Troy Ounce of gold is worth $1,500. You will more than likely not be working with that kind of quantity in your garage, you have to get the rate down to dollars/gram. This is easily done. Divide the current value (1,500) by 31.1, the number of grams in an ounce.
1,500/31.1 = $48.23/Troy Gram of Gold
For each pile, separated by Karat-age, you are going to determine the value. So, use the digital scale to weigh the 14k’s that you have in your possession (maybe that’s all you have, so all the easier). The following chart is going to be your benchmark. It presents what percentage of pure AU is in any given Karat amount, or in other words, the fineness of the karat.
8k = 33%
22k = 91%
Next, you’re going to calculate how much pure gold you have on hand. Fourteen karat gold is 58% gold, or .58 gold. So, multiply that amount by the current value of a Troy Gram, which we came up with earlier. The last step is to multiply this figure by the actual weight of your 14 karat stockpile. Let’s say it weighs 15 grams all together:
.58 (the fineness of 14 karat gold) x 48.23 (the value of a Troy Gram) = $27.97 (The value of a 14k gram of gold)
x 15 (the weight of your pile) = $419.55!
Understand now? Four-hundred nineteen dollars and fifty five cents is what the market is appraising your gold at "today" (and often, the value of a Troy Ounce is higher than $1,500). This same formula applies to any given fineness: just adjust for that percentage.
The purpose of this exercise, which is extremely easy for anyone to do, is to have a failsafe method against unethical pawn sharks or self-employed gold wholesalers who are rampant in the current economy. The message of this exercise, however, is not that you will be guaranteed anything very close to 100% of the marketplace value (i.e. $419.55), mostly due to the fact that the value changes so frequently. Why would a gold dealer buy your gold for 100 percent of the market value today when he can wait until tomorrow for it to drop? There will always be a buyer’s premium that will eat into your profit it because, hey, a gold guy’s got to make his profit, right?
At the end of the day, though, you did acquire the gold for next to nothing in a storage locker. Shop around for the dealer with the lowest buyer’s premium, and always check the current marketplace value whenever you feel it is time to liquidate your gold finds. Or, you may want to just stash the gold you acquire until you have enough of it to really make a profit.
There is often a much richer variety of merchandise in a storage unit to convert into smoother, more straight ahead profits, but it is always worth knowing this self-appraisal process for gold when it is time to get rid of your hoard. In a down economy, cash is king, but gold is always solid.
David Gross, SUAL.com Content Writer