Posted 2nd December 2022

What is a Troy Ounce of Gold?

gol bullion au bar

The price of gold constantly fluctuates, largely driven by market sentiment. If there is a high level of buying interest, the gold price increases. In comparison, when there are more sellers than buyers in the market, the price of gold bullion declines.

In this article, we will focus on the Troy weight system, including analysing the value of an ounce of gold today.

the troy ounce of gold pricing

How many grams in a troy ounce of gold?

One troy ounce equals 31.1035 grams, so 10 ounces of gold would correspond to about 311 grams. 

The Troy ounce is the most used unit of weight for all precious metals. Its use is also prevalent in modern gold trading.

The troy ounce today

Having up-to-date knowledge of the price of one ounce of gold is crucial for investors. That’s because the market prices many derivatives contracts related to gold, such as futures and options, in ounces.

For example, in the United States, the major international global trading hub, traders price gold in troy ounces. That also includes the influential COMEX (Commodity Exchange Inc) trading market.

In Hong Kong, the gateway to the Chinese market, the markets also price gold and other precious metals in troy ounces.

troy ounce vs ounce

Troy ounce vs ounce

The officially recognised unit of mass for gold is the troy ounce. We need to be careful when talking about ounces however as there are two different ways to measure in ounces.

One ounce in grams (its full title is an avoirdupois ounce) comes in at 28.35 grams using the metric system. 

To convert grams to ounces, you divide the mass value by 28.35. To convert the weight in grams into ounces, you multiply the grams by 28.35.

When we use troy ounces, one ounce of gold in grams is actually 31.1035 grams. This is the international standard of measurement used when you buy or sell gold.

A troy ounce is about 10% heavier than the standard ounce used to measure household items, such as sugar.

The troy ounce was previously used by the British Empire for weighing gold and silver, hence its international prevalence now.

The word ounce derives from Mediaeval French, which in turn comes from the Latin word ‘uncia’, derived from ‘unu’, meaning one. 

The ‘Troy’ measurement system has been in use since the end of the 14th century. It gained its name from the French city of Troyes where it was the weight measurement system used at the local town fair.

The troy ounce was already in use around 1400 in Britain’s private sector and was also adopted as coinage in 1527.

Understanding the per-ounce gold pricing

To work out how much one ounce of gold is worth, the calculation is pretty straightforward.

There are 31.1035 grams in an ounce of gold when you use the troy weighting system. To work out the price of a gram of gold, you divide the troy ounce price by 31.1035.

If the spot price of gold is $60 per gram, the value of an ounce of gold will be 60 multiplied by 31.1035, which equals $1,866.21.

Let’s now consider how to price gold investments in other currencies. This is important as gold is a global commodity that features in millions of investors’ portfolios all over the world.

You start with the same initial process. Then multiply the price in dollars per gram by 31.1035. You then convert this with the spot exchange range of the currency you’re interested in, like the British pound, the Japanese yen, or the Euro.

For example, let us imagine that the price of 1 gram of gold is $60 and the Euro/US dollar exchange rate is 1.05. This is how you work out the equivalent price of one gram and one ounce of gold in Euros.

The price of one gram of gold in Euro will be equal to 60 divided by 1.05, equalling €57.14. The price of one ounce of gold will be equal to 60 multiplied by 31.1035 divided by 1.05, which comes to about €1,777.

How much is an ounce of gold worth?

In addition to the weight of an ounce of physical gold, you also need to consider the purity. This is measured in carats.

This is the most widely used metric for measuring gold purity, where 24 carats represent the highest level of purity.

The most used carat measurements are as follows:

  • 8 carats = 333 thousandths per gram
  • 12 carats = 500 thousandths per gram
  • 14 carats = 585 thousandths per gram
  • 18 carats = 750 thousandths per gram
  • 22 carats = 916 thousandths per gram
  • 24 carats = 999 thousandths per gram

On financial markets, investors buy gold with very high purity or contracts with bars of gold containing at least 99.9% gold.

What is the price of one ounce of gold today?

To find out the price of one ounce of gold you need to look no further than Kinesis’ wide selection of charts. We pull live data from the physical bullion market to bring you the most up-to-date pricing on the markets.

You can monitor the price of physical gold bullion, aggregated across 6 continents on our live gold price chart.

What is the value of gold today?

Gold has a history dating back centuries. It plays a key role in the financial sector, representing the safe haven at times of market turmoil. 

Central banks have used and continue to hold gold as a key part of their reserves. The jewellery sector alone uses around 2.2 tonnes of gold.

Gold’s properties and suitability for jewellery-making have been known about for centuries. Rupert Rowling, Market Analyst for Kinesis Money, says:

“Gold’s appeal is not just decorative, as its unique chemical properties add to its value.

“The fact that it doesn’t have a high melting point, makes gold more malleable than other noble metals. It was this discovery that encouraged early civilizations to create beautiful jewellery from gold.”

As for the total available supply of gold, it is finite. That means, unlike with diamonds or fiat currencies, humanity is unable to create or fabricate it. This scarcity is why gold is often seen as a crucial part of any given financial portfolio.

Gold remains to be a valuable asset for numerous reasons, with this reputation likely to continue for the foreseeable future.

With a credential background in Economic Finance and International Exchange (MA), his critical analysis on gold and silver’s markets performance is frequently quoted by leading publications, week-on-week.

This publication is for informational purposes only and is not intended to be a solicitation, offering or recommendation of any security, commodity, derivative, investment management service or advisory service and is not commodity trading advice. This publication does not intend to provide investment, tax or legal advice on either a general or specific basis.