Gold is indeed a unique investment. Contrary to other commodities, which made to be consumed, such as oils or natural gases, gold is actually created for collecting purpose. This is the reason why gold maintain special position from other commodities.
Gold that gets around in the normal population of the world today are mainly produced from change ownership from one person to another or from a financial institution to a person. It is rarely from recent mining activities, because the stock of gold on Earth is quite rare right now. From mining operation and activities, the total stock of gold in the world only increased by 1.7 percent every year.
The amount of gold that has been processed until these days is simply around 155 thousand tons. If everything is melted, then it would only cover about 8 thousand cubic meter, or filling three-quarters of an Olympic standard swimming pool. This is extremely small indeed, considering gold mining may be done for thousands of years.
Basically, the provision of gold buyers will never increase significantly, because the emergence of new gold mines is too small in numbers. This is why latest gold price completely reflects the demand, not supply any longer. With this rarity, no wonder gold is considered as precious metal and used for production of jewelries.
Gold jewelries are often created by mixing gold with other metals. This is because pure gold is quite soft and hard to form. Metals widely used for mixed materials are nickel, copper, silver, zinc, rhodium and others. In example, jewelry with gold content of 80 percent signifies that the gold content in the jewelry is only 80 percent, while other 20 percent are a combination of metal.
With all the mixtures of metal involve, prices of gold jewelry will not congruent with the world price index of pure gold.
This means that while obtaining gold in the form of bars or coins can refer to world price index, the same case can’t be applied in sell gold jewelries. When the value of gold increases in market, it doesn’t imply that price of gold jewelries will also follows. Prices of jewelries are generally set by shops that provide them.
Any retail outlet has a several pricing policy. Gold shops with branded famous jewelries will market their jewelries at a higher rate, simply because of the quality of the gold, quality craftsmanship and its famous brands. Recent model of jewelries that are sold are usually pitched with higher rates than the old ones. Because jewelry also a form of accessory and follows trends.
Exactly the same rules also implemented when selling gold jewelries. The value offered by customers might not in accordance to gold prices in the marketplace generally. There are a lot of things considered by a buyer prior to accepting gold jewelries. That is why it’s essential that you choose buyer that are ready to pay top price for your gold jewelries.
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October 24th, 2011 by