Trading in Precious Metals, by Kestrel

My butcher pulled me aside last fall, while I was in his shop dropping off a deer for processing. He had a gold ring with a diamond mounted in the center. He asked me what it was worth? I own a jewelry store and told him I would take it to the store, weigh it, and give him a price. He explained that a woman came in for some meat and couldn’t pay; she gave him the ring to hold with the promise to come back and pay him the $60 that she owed within the next week. It had been a few months, and she never came back. He was afraid that she had duped him.

I weighed the ring and measured the diamond. The next day I called and told him I would give him $130 for the ring. He gladly agreed, and I paid him cash less the price of the venison. It worked out very well for him, but he could have taken a few steps to better ensure he didn’t get cheated.

You may imagine trading in junk silver, food, and ammo in a post-apocalyptic world. Maybe that will work out okay for you, but millions of people haven’t put aside silver and gold coins, ammo, or food to use for trade. These folks will probably have jewelry and sterling silver items to use as trade. People are trading their old jewelry and silverware that they never use anymore right now, while the economy is in bad shape but still running. If the economy collapses, or falls even further than it has, even more people will need to get something useful from their metal.

The scenario I shared in opening the article is becoming more common every day. You might say that you just wouldn’t do it, because it’s not worth the hassle and risk of trading in people’s jewelry. That’s fine; you can stop reading now. For the rest of you, some basic equipment and knowledge of simple math is all that is needed.

Determining Metal Content

Look for stamping

The first thing to do when trading for old jewelry or silverware is determine the karat or “fineness” of the piece. Most pieces are stamped. A 10x jeweler’s loupe makes reading quality marks easier. (They are available for under $20; just be sure to get one that is “fully corrected”.) “Fineness” is simply a percentage of precious metal in the piece. For example, 585 fine is 58.5% precious metal. “Fine” metal is pure; fine gold is 99.9% or 99.99% gold. Here is a list of common karat marks in U.S. jewelry:

  • 10k (41.67%)
  • 14k (58.33%)
  • 14kP(58.33%)*
  • 18k (75.0%)
  • Ster (92.5%)**
  • 416 (fineness 41.6% gold)
  • 585 (fineness 58.5% gold)
  • 750 (fineness 75.0% gold)
  • 925 (fineness 92.5% silver)
  • 900pt (fineness 90.0% platinum)
  • 950pt (fineness 95.0% platinum)

    Other markings seen on metalwork are often maker’s marks (hallmarks). Things to stay away from are stampings that say “GF” often with a fraction of 1/20 or 1/12. This is gold filled and should not be given any metal value. “GE” of “HGE” are gold electroplate or heavy gold electroplate; there is no metal value in these. Old pieces sometimes are stamped “rolled gold plate”; again, there is no metal value. Also, stay away from anything that says “XXXXX Silver”. These are nickel silver. Often the stamp will say “German Silver” or “Mexican Silver”, but I’ve seen many other names in front of the silver stamp. There is no silver in these.

*The “P” after karat weight doesn’t stand for “plated”; it stands for “plumb”, as in exact.

**Sterling silver legally can be as low as 91.5% silver.

Verify metal content

Never trust the quality stamp, as there are way too many fakes out there. Some fakes are easy to spot. I had a bracelet in the shop yesterday that was stamped 14k. The plating was flaking off, and the color of the gold wasn’t right. It was sterling silver stamped 14k and plated. That one was easy to spot, but there are some good fakes out there. Also, be aware that gold can be alloyed to make just about any color including white, red, green, and blue. You will need, at the very least, acid for testing the metal. It should be noted that no test will tell the exact metal content of the piece, except a destructive assay.

Aqua regia is a time tested method for testing precious metals. To make aqua regia, mix one part nitric acid to three parts hydrochloric acid. If this isn’t something you are comfortable with, don’t worry; there are other methods of testing metals. To test with aqua regia, file a spot on the piece. (It doesn’t take much, just enough to remove any plating– usually one or two swipes with a needle file.) Put a drop of acid on the spot you just filed. If the spot starts to bubble and turn green, it’s a fake. Sterling silver will turn a cloudy cream color. Aqua regia should be washed off of anything it touches with lots of water.

Acid test kits are available. You can buy acids pre-mixed to dissolve common fineness of gold. Usually kits come with 10k, 14k, and 18k acids, and a streak plate or touchstone. A kit can be put together for under $30. Use is pretty simple.

  1. Rub the piece on the stone to leave a streak of metal.
  2. Rub a piece of known 14 karat gold on the stone. (Your wedding band would work, if it is 14k gold.) Try to use the same color of gold, if possible.
  3. Apply a drop of each type of acid to the metal streaks.
  4. Compare how the metal in the 14k streak reacts vs. the unknown streak.
  5. If it dissolves under the 10k acid, it is fake or very low karat; if it dissolves under the 14k acid, it is 10k; if under the 18k acid, it is 14k, et cetera.

Electronic testers are available, too. They are expensive and unnecessary. The ones I’ve used have worked well, but nothing is foolproof except an assay done by a refinery.

Silver can be tested with these acids, too. I advise you use the acid on some sterling and coin silver to see how it reacts. Compare this reaction to nickel silver. A rare earth (Niodymium) magnet is a must for testing silver. They can be bought locally at a tool or electronics store for a couple of dollars. There are many videos out there showing how the magnet drags on silver, without immediately falling off, which it does on many other metals. Get one and experiment with how the magnet works on different metals.

Weigh the piece

You will need a scale for this; there is no way around it and no substitute that I am aware of. The scale doesn’t have to cost a fortune. If you are a reloader, a grain scale works very well. A word of caution: Metals are weighed using TROY WEIGHT, not avoirdupois weight. If you have an avoirdupois scale, multiply avoir. Multiply avoirdupois ounces by .91146 to get troy ounces. Below is a chart of common conversions needed in weighing metals.

Change From:


Multiply by:





oz troy






oz troy


Oz troy



Oz troy


















Finding the Value

Now that we have a weight and a metal quality, multiply the weight by the percentage of precious metal in the piece. If a ring weighs 6.4dwt (pennyweight) and is determined to be 14k (58.33%), take 6.4 x .5833 = 3.73312dwt of fine gold. Then, convert 3.73312dwt to troy ounces by multiplying it by .05 to get .186656 ozt.

Now, find out what gold is going for. There are numerous websites that will give you metal prices updated by the minute. is the one I use, but any of them will work. If gold is $1300/ozt, multiply .18665 x 1300 = 242.65. Therefore, the gold content in this ring is, at that time, valued at $242.65.

Making an Offer

Now that we know what the market value is of the gold, it’s time to make an offer. You can’t offer $242.65 for the above ring; here is why. You have to get rid of the ring to get money for it. You can send it to a refinery to be melted down and the refinery will write you a check or send you bullion in trade. You won’t get $242.65. You could take it to a local jeweler, coin shop, or pawn shop (GOD forbid), and see what they will give you for it; it won’t be $242.65. Alternatively, you can offer it for sale or trade at a swap meet, flea market, or in a classified ad. If you paid full price and then resell it, you could probably make some money on it, but you will need to hold onto it until someone wants it.

Always assume you will need to send it to a refinery or sell it to a coin/jewelry store. If you send your metal to a refinery, they will pay up to 95-96% of market, minus shipping. Local buyers will generally pay between 10% and 80% of market value. If you deal locally, shop around for the best deal.

If you are dealing with a refinery there are some things you should be aware of. First, it isn’t worth sending metal to a refinery unless you have a bunch of it, and the more you have the better return you will get. Most refineries have a payment schedule listed on their website explaining what fees and percentages are charged and paid. Also, you will probably need a business. Refineries don’t want to deal with the public. You will need to fill out an anti-money-laundering form, stating that you aren’t a criminal. Some refineries will hold your metal until you tell them to cash it out– generally, when the market hits a point you like.

Now back to making an offer. Along with the problem of getting rid of the piece, you need to worry about the metals market dropping. You can’t pay full price at $1300/ozt and then sell for 95% of a market that has dropped to $1250/ozt.

What if that 14k ring is really 13.4k? Simple testers won’t pick up a few tenths of a karat difference. In fact, legal regulations allow any gold piece with solder in it to be under-karated slightly, and if you are trading a lot in metals, a fake will slip by once in a while.

Sometimes, there are stones in jewelry– a crystal in an old watch. Sterling silverware is often filled with plaster or wax. So just determining the exact precious metal weight of a piece is often not possible.

I won’t tell you what percentage to offer. That is something you can decide on your own. I will say that you should offer 10-15% less market just to cover your butt against the above problems.

Here are some refineries I’ve used in the past with good results: Hoover and Strong, Maguire Strickland, Stebgo, and North American Metals.

Things to Watch Out For

In the U.S., gold below 10k can’t be stamped gold. However, there is a bunch of 8-9k gold out there– mostly from south of the border. Buy at your own risk.

You may come across 20-22k gold, as it is sometimes seen. It has a very rich color and comes from Europe and Asia, mostly.

A magnet will tell if the piece is steel; use it on every piece. If it sticks, it’s fake.

Platinum can be a little difficult to identify, if you haven’t played with it before. Platinum is heavy and soft. It is also very tenacious; it doesn’t like to be removed from itself. Drag a file across a piece of platinum, and it will bite and move with unexpected difficulty.

Silverware, candlesticks, bowls, and cups can be problematic. The bases of most of these are weighted with wax or shellac, and silver knives have steel blades and hollow handles that are filled with plaster. Getting a weight on these is impossible without destroying them. Spoons and forks are usually solid sterling. If it says “silverplate” or isn’t stamped “sterling”, it isn’t real.

What do you do with the gemstones in jewelry? I wouldn’t offer any money for stones in jewelry. Can you tell a cubic zirconia from a diamond? A synthetic from a real sapphire? What if the stone is scratched? How much can you sell the stones for and to whom will you sell them? I would offer to give the stones back if the seller wants them and they are easily removed. Prongs can be pulled back with fingernail clippers, if you are careful. Just always let the seller know there is a risk of breaking the stone upon removal.

If metal isn’t stamped, that doesn’t mean it isn’t gold or silver. Jewelry is often repaired, and in repairing (especially rings) the quality mark is removed.

I’m sure I don’t have to say this for anyone here, but if you are dealing with this kind of stuff on the street, be careful.

One day an opportunity may come your way involving “junk” precious metals. I hope this article gives you the confidence to profit from the situation.