What Are Gold Karats?
- Oct 19, 2025
- loveGOLD
- 3 minute read
The information contained in this article is current as of the date of publishing.
If you’ve ever looked into purchasing gold, you’ve probably come across the term “karat.” But what is a karat, and how does it affect your investment? In this blog, we’ll explain how karats work so you’ll know more about what to look for when considering gold bullion.
The information contained in this article is current as of the date of publishing.
If you’ve ever looked into purchasing gold, you’ve probably come across the term “karat.” But what is a karat, and how does it affect your investment? In this blog, we’ll explain how karats work so you’ll know more about what to look for when considering gold bullion.
Karats: The Basics
Karats are one of the ways to measure the purity of gold, that is, how much of an item is actually gold vs. how much of it is made up of another metal. Karats are measured in 24ths, so 24-karat gold is typically around 99.9% pure gold.[1] Gold described as 18-karat is 18/24 (75%) gold and 6/24 (25%) other metals, while 10-karat gold is about 42% gold and 58% other metals.[2] The scale runs all the way down to 1-karat, which is only 1/24 (about 4%) gold, but Canadian standards require at least 9 karats for jewellery to be legally considered gold.[3]
Gold’s purity may also be presented in terms of parts per 1,000, or millesimal fineness. Using this system, 18-karat gold is described as “750,” indicating that gold makes up 750 parts per 1,000, or 75%, of the alloy.[4] Gold bullion is typically described using this system, rather than karats, in part because of its greater precision. While any gold that’s at least 99.9% pure may be described as 24 karats, that’s the bare minimum for gold bullion, which often comes in much higher purities. The Royal Canadian Mint has been a leader in gold purity for decades: In 1982, we introduced the world’s first 99.99% pure gold bullion coin, and achieved 99.999% purity (sometimes referred to as “five nines”) in 1998.[5] Today, we remain one of the few mints in the world to offer five nines fine gold bullion products.[6]
Carats vs. Karats — What's the Difference?
Karats refer exclusively to gold purity, while carats are generally used to indicate the weight of diamonds and other gemstones — but "carat" can also be used to describe the purity of gold.[11] However, troy ounces are a more common way to weigh gold, and are typically the primary weight measurement used when trading bullion.[12]
Because spelling conventions vary, and “carat” may sometimes also be used to refer to gold purity, be sure to confirm what units you’re dealing with when you see mention of carats.[13]
The use of "karat" to describe a precious stone is considered incorrect.
What Karats Mean For Investment
In general, because higher-karat gold items contain more gold, they typically command a higher value — for both buying and selling.[14] Because they’re designed for investment and don’t have to serve a functional purpose (unlike jewellery, which must stand up to wearing), bullion products are typically much closer to 24-karat gold than most other gold items, and must usually be at least 99.9% pure. The Royal Canadian Mint’s gold bullion offerings, for example, are at least 99.99% pure gold, with some premium offerings available in five nines purity.[15] Many also come with certificates of authenticity confirming the item’s purity and weight.[16] If you’re thinking about adding gold to your investment portfolio, reach out to your financial advisor for guidance on the best options for you.
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[1] Guardian Gold, Gold Purity 101: Your Ultimate Guide to Understanding Gold’s Quality.
[2] Guardian Gold, Gold Purity 101: Your Ultimate Guide to Understanding Gold’s Quality.
[3] Government of Canada, Detailed Requirements for Marking of Precious Metals.
[4] Guardian Gold, Gold Purity 101: Your Ultimate Guide to Understanding Gold’s Quality.
[5] Royal Canadian Mint, Refinery.
[6] Royal Canadian Mint, Refinery.
[7] Guardian Gold, Gold Purity 101: Your Ultimate Guide to Understanding Gold’s Quality.
[8] Guardian Gold, Gold Purity 101: Your Ultimate Guide to Understanding Gold’s Quality.
[9] World Gold Council, Is Gold Jewellery a Good Investment?
[10] Guardian Gold, Gold Purity 101: Your Ultimate Guide to Understanding Gold’s Quality.
[11] Guardian Gold, Gold Purity 101: Your Ultimate Guide to Understanding Gold’s Quality.
[12] World Gold Council, Is Gold Jewellery a Good Investment?
[13] World Gold Council, Is Gold Jewellery a Good Investment?
[14] AU Bullion, Comparing 10K, 14K, 18K, 22K, and 24K Gold Prices: Which Is the Best Investment?
[15] Royal Canadian Mint, Gold Bullion Coins.
[16] Royal Canadian Mint, Gold Bullion Coins.
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