What is a Troy Ounce and why is it important to you?
The expression troy ounce is widely used in the precious metals industry. If you’re new to precious metal investing, you may have wondered what exactly is a troy ounce and why is it significant to the precious metals industry? The history of the troy ounce, precious metal scales, the troy ounce in modern times, with a dash of color grades, will all be covered in this article.
The History of the Troy Ounce
Within the precious metal market, the troy ounce serves as its primary weight measurement. It is thought to have started in Troyes, France, in the Middle Ages. The troy ounce is said to have been created as a mechanism to standardize the weight of precious metals for trading purposes since Troyes was a hub for trade and commerce.
It was likely simply a designated central weight to be compared against. Likewise, the meter is a metal bar in France, that is… well, the length of a meter. As that was not very scientific, apparently to sound official, the meter is now defined as the distance light travels, in a vacuum, in 1/299,792,458 seconds. Anyway, a central agreed upon unit had to be something. The troy ounce was that something when it came to gold.
It is no wonder Troyes was a center of commerce.
Eventually the British Empire adopted the unit and became the official unit of weight for precious metals in the 15th century. A tradition that is alive and well, as the troy ounce is still used to measure the weight of precious metals, and has almost become a surname of gold, silver, platinum, and palladium.
Color Grades and Scales for Weighing Precious Metals
Beauty is in the eye of the beholder met its match when it comes to measuring precious metals, as color grading and scales are important factors to consider, yet subtle is the line when a color passes a grade or not. Color grades are used to determine the purity of a precious metal, opposite of precious gems, the higher grades with metals indicates a higher level of purity.
Scales, perform their traditional objective function of simply weighing the metals. In the precious metal industry, there are several different scales that can be used, including the troy ounce, the metric system, and the avoirdupois system.
But weighing the elusive metals is a finite art. If you have ever wondered what exactly is the difference between gold and silver, now you can see for yourself.
Pay attention to details when shopping for the noble metals:
A rather large gathering of the above atoms can result in a significant change in value.
The raw science says one troy ounce is equal to 31.1034768 grams, or about 1.097 ounces in the avoirdupois system. You may be more familiar with the feel of this weight than you think. Common objects that way 1 oz. are the pencil, a CD, AA battery, and a slice of whole wheat bread. You probably never noticed that when you picked up 6 sheets of paper you were holding an ounce. Same when you held a $1.25 in all quarters (that’s 5 quarters for those using the metric system). The next time you need to test the weight of a claimed 1 oz, you can verify with 28 paperclips.
Or ten pennies if you are in a pinch.
The Troy Ounce Waits for No One
This is the most commonly used scale for measuring precious metals. And is our industry’s standard unit of weight for gold, silver, platinum, and palladium, as well as the other four precious metals.
The key take away is we must be diligent and do our homework with precious metals. It’s important to understand the weight and purity of the metal you are buying. As well as the current market price of a troy ounce. Because that is the most important unit of weight in the precious metal industry. We hope you now have a better understanding of the troy ounce. As it is important in the industry, as key to making informed decisions.