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What is Fine Gold?

What is Fine Gold?

Before placing an order for fine gold either through an online bullion dealer or through a local gold and silver retailer in your neighborhood, you need to know what you are buying and that means understanding exactly what is meant when you hear the term “fine gold.” As anyone familiar with the gold smelting process will cheerfully inform you, measuring gold’s purity is an exercise that is easily one part science and two parts art. Understanding what constitutes “fine gold” is instrumental for collectors, investors, and numismatics because of the critical role this precious metal plays in the making of coins and bullion.

When denoting gold’s purity, the term “fine gold” references precious metals that is graded using a scale of millesimal fineness, which accounts for the number of parts one thousand of pure metal in the alloy based on its mass. Generally speaking, this mass is rounded to a three digit number with decimal points used when the measurement is used to demark a hallmark. As such, a fine gold piece containing 99.9 percent gold would be marked as 999 or .999. Fine gold not marked with a number represents small golden flakes or dust that is small enough to pass through a sieve.

When determining exactly what constitutes “fine gold” there is a certain amount of leeway legally provided. As 100% pure gold is a metallurgical impossibility, the purest commercially available gold is 999.99, referred to as five nines fine, the Canadian Mint, in the making of commemorative coins frequently utilizes this purity. Directly below this benchmark of excellence, 999.9, or four nines fine, and is used in the manufacture of the American Buffalo and Canadian Gold Maple Leaf coins.

The most common fine gold purity used is 999, however. While referred to as 24 karat, which is technically 100% pure, achieving that level of purity, is near impossible outside of a laboratory setting. In making their gold products, gold manufacturers are legally afforded a half-karat tolerance, and this leeway is called a three nines fine.

The fine gold supply chain begins with the prospector who first extracts the samples from the earth to analyze for purity. Scientist find locations where gold is highly concentrated before checking for the metal’s gold content. If the material is found to be pure enough, mining operations proceeds on an industrial footing. Typical extraction methods include open-pit mining, underground mining efforts, or panning techniques depending on conditions on the ground and the precious metals location.

Once the gold-bearing ore is extracted, it is broken down into small pieces in preparation for breaking it down further into a fine powder or slurry mixture. This agent, then thickened with water before being run through a leaching tank, which results in the gold adhering to small grains of carbon that has been introduced to the tanks. Following a process known as electrowinning, a process that separates the usable gold from the leaching chemicals, is the final process before the gold is sent for refining. A final check of the metal’s purity is made before the gold is melted down and used to make coins and bullion.

Fine gold, owing to its relative softness, is not used in the production of jewelry, but is rather reserved for the making of gold coins and bullion. Because these items are frequently used for investment purposes, the purity of their content is of paramount concern. Another advantage in the use of fine gold in the manufacture of coins and bullion is the lack of impurities in the metal. Investors’ looking to understand all aspects of the investing landscape benefit from a solid understanding of how fine gold is produced.

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