How Many Types Of Gold Are There?

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Gold has been around for a long time. In the past, it was used mainly as a currency, and while it has retained this status in some cultures, it is now mainly considered an investment vehicle.

People mostly buy gold to diversify their portfolios and protect against economic unrest. If you want to purchase gold, you might want to know the different options open to you. You want to know how many types of gold there are.

For investment purposes, gold is divided into physical and digital. Physical gold also comes in different forms. There are also five different types of gold based on purity.

This article will look at these classifications and provide details on all the different types of gold.

What Is Gold?

When we mention gold, we mean the precious yellow metal mined and used in making coins, bars, and jewelry, among other things.

In its purest form, gold is soft and easy to mold. For this reason, most of the gold we see are not in their purest form.

However, gold has gone beyond the physical. As you will see, there are ways to own gold without getting hold of the tangible precious metal. But first, let’s understand why gold is expensive and why you should invest in it.

Why Is Gold Expensive?

Gold is considered a precious metal. This preciousness comes from the fact that gold does not oxidize. Pure gold can remain the same way forever. It is resistant to the elements, and it does not rust.

For this reason, it has been used as currency and jewelry since ancient history. This value has only continued to grow. And now, even though it is not used as a currency in certain areas, it still has value and is one of the most stable investment properties.

But there is something else that adds to the value of gold apart from its unique properties; gold is very scarce, and it is this scarcity, more than anything, that makes gold expensive.

Types Of Gold

Let’s look at the different classifications for gold. For the purpose of this article, we will be telling you the types of gold using two different classification methods:

  1. Tangibility
  2. Purity

1. Types Of Gold Based On Tangibility: Digital Or Physical

This classification is solely for investment. When trying to invest in gold, different options are open to you. You can buy gold units, or you could invest in mutual funds, mining companies, and futures.

If you decide to buy gold, you can buy physical or digital gold.

Physical Gold

Physical gold is gold, as most people know it. It is the tangible form of gold that you can hold and feel and use. When people hear about gold investments, they usually think about physical gold.

It was used to make gold coins and bars were used as legal tenders, and it was also made into jewelry. Nowadays, people purchase physical gold as investment and protection against uncertain economies.

As an investment option, physical gold is not affected by inflation or economic changes. The price remains stable, and if history is any indication, it will continue in an uphill trend.

The value of physical gold is not just about the weight. Physical gold is rare, and this demand adds to its value. Some physical gold also has historical value; if you are lucky enough to own these, the price will be higher.

Physical gold comes in three main forms:

1. Gold Coins

Gold coins are small and usually round. They are a convenient form of gold that was first minted to be used as legal tender. Gold coins are traced back to 500 BC during the reign of King Croesus of Lydia, but they became popular during the 1800s.

Because gold coins were used in history as legal tender, so they have gained more value. Gold coins also have a certain allure due to their historical value.

Nowadays, gold coins are minted for investment reasons. Each of these gold coins is unique and marked with the date of minting, purity, and weight.

Gold coins are one of the best ways to invest in physical gold. They offer you the chance to start small and slowly build your portfolio.

2. Gold Bars

Another common form of physical gold is gold bars. They are also called gold ingots and are standardized and refined rectangular gold bars minted by the government and private institutions.

Standardized in the sense that these gold bars can only be considered legal if they meet the standard manufacturing and labeling conditions. When you purchase a gold bar, it comes with a certificate that shows that it has met the standards and other information about the gold bar.

Most gold bars are made from gold with 24 karats or .999 purity (we will discuss these concepts later). Gold bars come in different sizes with a minimum of 1 ounce and a maximum of 1 kilogram.

Gold bars are considered the most effective form of physical gold investments because they are cost-effective, portable, and extremely liquid.

3. Gold Jewelry

Jewelry is probably the most common form of physical gold. You probably have a family heirloom tucked away that is partly made of gold.

Gold has been used in jewelry for the longest time. Ancient Egypt, Greece, and many civilizations used it to distinguish the classes. Everyone coveted jewelry made from this precious metal.

In present times, gold jewelry has become more than just extra ornaments that we put on those special occasions. They have become another way to invest in gold.

Gold jewelry comes in different colors due to the metal they were mixed with to strengthen them. However, the gold in its pure form can always be extracted, and the value of the gold, based on weight and purity, still adds to the value of the jewel pieces.

And if gold’s price increases, the jewelry’s value increases too, which is why gold jewelry remains one of the best ways to keep gold long-term. It is, literally, an investment option you can wear.

Digital Gold

The world is becoming increasingly digital. We can work from home and connect with people on the other side of the planet. And with digital gold, you can now hold gold without buying physical forms of the metal.

Digital gold is also known as digital gold currency and is a more affordable and accessible alternative to buying physical gold.

Think of it this way; when you buy physical gold, you need to spend extra on storage and insurance. You also run the risk of theft. Digital gold takes care of all these issues for you.

You would typically buy your digital gold from a company that offers this service, and for each unit of digital gold you buy, this company will store the equivalent bullion in a vault with your name.

If you decide to sell, they will remove this bullion. Just like physical gold, digital gold is very liquid, and you can redeem them for physical gold anytime you want.

These companies will handle the storage and the insurance for your gold. An advantage digital gold has over physical gold is that you can buy gold in any quantity. It is a great way to start creating your gold portfolio.

2. Types Of Gold Based On Purity

In its basic form, gold is a metal. It is soft and malleable, which reduces its functionality. It is why gold is often mixed with different metals; to give them more strength and add color.

Unfortunately, in this process, the quality and value of the gold are reduced. When a metal is added to gold, the purity is reduced.

The unit for measuring the purity of gold is karats. The purest gold is 24 karats and is usually considered 100% gold or .999 gold.

The purity of gold is usually measured against this number, and the most common karats you will see in the United States are 24, 22, 18, 14, and 10 karats.

24 Karat

If you are trying to invest in gold bars and coins, 24 karats gold is usually the most common. It is gold at its purest and is said to be 99.9% or .999 gold. It is the most expensive type of gold and the shiniest too.

There are many advantages to pure gold. It is hypoallergenic and has the highest resistance to the elements and corrosion. Most of the physical gold bars and coins are made from this type of gold, which is why they are so expensive.

Gold bars and coins made with 24 karat gold have the word gold, 24 karat/24K, or .999 inscribed.

However, 24 karat gold is also very soft, so they are not a great option for jewelry. Jewelry made with 24 karat gold will deform easily.

22 Karat

22 karat is the closest to pure gold. It is said to be gold that is 90-92 percent pure. 22 karat gold is not as expensive as 24 karats, but the difference isn’t that much.

22 karat gold was mainly used in minting coins in the 1800s. It was usually 92 percent gold, and the remainder was silver or copper. This was done to give the coin more strength while maintaining all the advantages of pure gold.

Coins made with this gold have the date and the number of karats inscribed on the back. Notable coins minted with 22 karat gold include the South African Krugerrand and the American Gold Eagle.

Like 24 karat, 22 karat gold is hypoallergenic and highly resistant to the elements and rust. However, even though it is not as pure as 24 karat gold, it is still too soft to be used for jewelry.

18 Karat

From this point, the shininess of gold is sacrificed for durability. 18 karat gold is gold that has been alloyed with other metals in the ratio of 3:1. That is 75 percent gold and 25 percent a metal like copper.

While the shine of 18 karat gold is not as bright as 24 or 22 karats, most people who have not handled gold bars or coins won’t be able to tell. 18 karat gold is used to make jewelry because it is durable enough.

The most common marks on objects made with 18 karat gold are 18 karat or .750, signifying the amount of gold in the object.

18 karat gold is hypoallergenic because the ratio of other metals in the alloy is not sufficient enough to induce allergies or skin reactions, even for those with very sensitive skin.

14 Karat

This is the most popular form of gold used in making jewelry. It is more durable than 18k, but it is not as bright.

14 karat is more affordable than 18 karat, and because it is durable and can withstand daily wear, it is mostly used in making jewelry.

Objects made with 14 karat gold are marked with 14 karat or .583 to signify the parts that are pure gold.

Most people would not have allergic reactions to 14 karat gold, but if you have highly sensitive skin, you can request one made with metals you are not allergic to.

10 Karat

10 karat gold was, for a long time, the lowest level of gold for making jewelry. It is extremely durable but not as pure as the rest, so the color is dull. It is not great for making special jewelry. Purchasing jewelry of 10 karat gold for investment purposes might not be a great idea.

It is also more likely that you will get an allergic reaction from this type of gold because the ratio of the other metal to gold is higher.

Objects made with 10 karat gold are usually marked with 10k or .417 to signify the amount of pure gold in the alloy.


Gold is a great investment vehicle. It diversifies your portfolio and protects your wealth. Knowing the different options of gold available is necessary when you want to start investing in gold.

If you want to buy gold, our advice is to buy gold bars, coins, and jewelry of the highest possible quality. Most gold bars and coins are minted at the highest quality, so this isn’t an issue.

If you would rather start small, digital gold is a great way to start adding gold to your portfolio. Whichever option you choose, gold is an investment option too good to ignore.

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