Karat vs. Carat: What’s the Difference?

gold-diamondsEver wondered what the difference is between karat and carat? The terms are often used interchangeably, but technically they are two different measures of two different things.

Karat

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When describing gold coins or jewelry, three specifications are usually provided: weight (in troy ounces), dimensions, and fineness/purity. Gold fineness, or purity, is the ratio by weight of gold to any base metals (more common, inexpensive metals) or impurities in a particular piece, expressed in parts per 1,000. It may also be expressed as a decimal (e.g. “0.999 pure gold”) or percentage (e.g. “99.90% pure gold”).

Karats are another way of expressing gold purity. Using a gold coin as an example, karats are calculated by multiplying the mass of pure gold in the coin by 24 then dividing by the total mass of the coin. One karat represents 1/24 of the whole, so 24-karat gold is referred to as “pure gold”. A 22-karat gold coin is 22 parts gold and 2 parts base metals or impurities.

The most common purities used for gold products are:

  • ≥99.90% = 24 karat (Canadian Gold Maple Leafs, American Gold Buffalos, Austrian Gold Philharmonics)
  • 91.60% = 22 karat (South African Krugerrands, American Gold Eagles)
  • 83.30% = 20 karat
  • 75.00% = 18 karat
  • 62.5% = 15 karat
  • 58.50% = 14 karat
  • 41.70% = 10 karat
  • 37.50% = 9 karat
  • 33.30 = 8 karat

Arguably the purest gold coin ever produced was refined by the Perth Mint in 1957 and had a purity of 0.999999 (99.9999%).

Carat

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By Ayswaryak (Own work) [CC BY-SA 3.0 or GFDL], via Wikimedia Commons
Carats measure the mass of diamonds or other gemstones. One carat equals 200 milligrams or one-fifth of a gram. A flawless diamond of at least 100 carats is called a paragon. Prior to 1907, countries had their own measures of what one carat equals. The system was standardized in 1907 at the Fourth General Conference on Weights and Measures with the adoption of the current carat, equal to 200 mg.

In American English, karat is for gold and carat is for gemstones. In many other countries, karat can be spelled as carat and vice versa, but the two separate meanings still exist.

Etymology

According to the Online Etymology Dictionary, karats as a measure of gold purity came before carats as a measure of diamond weight. The word carat (and its variant spelling karat) traces its origin to the mid-15th century from the Arabic word qirat, meaning “fruit of the carob tree” and also “weight of 4 grains,” and from the Greek word keration, meaning “carob seed,” and also the name of a small unit of weight. At the time, carob beans were a common measure of weight in small quantities. Keration was the Greek equivalent of the Roman siliqua, which equaled 1/24 of a gold solidus (Late Roman Empire coin) of the emperor Constantine. Appropriately, karat meant “a proportion of one twentyfourth” and became a measure of gold purity in the 1550s. Carat as a measure of diamond weight emerged in English in the 1570s.

Purchase 22- or 24-karat gold coins from American Bullion

American Bullion offers 22-karat American Gold Eagle Coins, as well as 24-karat Canadian Gold Maple Leafs, American Gold Buffalos, and Austrian Gold Philharmonics. We can help you with either purchasing them for direct delivery to your home or adding them to your IRA or former 401(k). Call us today at 1-800-326-9598 to get started.

About American Bullion

American Bullion, Inc. specializes in converting your IRA, old 401k, or other qualified retirement plan to a self-directed IRA capable of holding physical gold coins and bars, known as a Gold IRA or Precious Metals IRA. We’ve pioneered a system to handle all the details for you, tax-free and hassle-free. Want to buy gold and silver and store it yourself, outside of your retirement account? Simple – we’ve insured and shipped millions of dollars’ worth of gold, silver, platinum, and palladium to thousands of homes just like yours. As a U.S. Mint nationally listed dealer, we strive to be the best Gold IRA company in the industry and guarantee every transaction is fast, simple, and secure. See our American Bullion Reviews page for testimonials from our many satisfied clients.

Although the information in this commentary has been obtained from sources believed to be reliable, American Bullion does not guarantee its accuracy and such information may be incomplete or condensed. The opinions expressed are subject to change without notice. American Bullion will not be liable for any errors or omissions in this information nor for the availability of this information. All content provided on this blog is for informational purposes only and should not be used to make buy or sell decisions for any type of precious metals.