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When dealing with silver, precision matters. While most everyday items use standard ounces equal to 28.35 grams, silver follows a different path.
The precious metals industry uses troy ounces, an ancient measurement system that sets an ounce of silver at 31.1034786 grams. This seemingly small difference of about 3 grams can significantly impact your silver investments and trades.
This article explains the intricacies of converting grams to ounces when purchasing silver products and why the precious metals industry uses the Troy system.
The difference between avoirdupois ounces and troy ounces becomes clearer when both are converted to grams.
| Measurement | Avoirdupois | Troy |
|---|---|---|
| 1 Ounce | 28.35 | 31.1034768 |
| 1 Pound | 453.59 | 373.24 |
As you can see, a troy ounce is equivalent to 31.1034768. In percentage terms, a troy ounce is 9.7% heavier.
You will also note that a troy pound actually weighs less than a standard pound. Because a troy pound is 12 troy ounces, and an avoirdupois pound is 16 avoirdupois ounces, a troy pound weighs about 82% as much as a standard pound.
The troy system, including its name, draws its inspiration from the French city of Troyes. Troyes was a major commercial hub during the Middle Ages, and its merchants arrived at the mass of an ounce by referencing a specific quantity of barley grains, a common trading commodity. Specifically, a troy ounce was defined as 480 grains.
Another choice made by the merchants of Troyes was to hearken back to Roman times. The Romans used bars and coins of bronze as currency, and a bar could be broken into twelfths.
These twelfths were called “uncia,” which literally means “one-twelfth.” As time passed and speakers of different languages spoke this word, the word uncia became ounce.
Because the word ounce referred to a division into twelfths, the Troyes merchants decreed that a troy pound contained 12 troy ounces. The later Imperial system decided that its pounds required 16 standard ounces. Thus, a standard pound weighs more than a troy pound, even though troy ounces weigh more than standard ounces.
The real importance of these conversions is how you use them to understand the different amounts you’ll encounter in precious metals investing.
If you are more interested in coins and numismatism, then you’ll likely not encounter the metric system. Almost all coins are minted in ounces, and many of them are 1 oz. pieces.
However, with coins, there are added dimensions to their valuation. Coins are items minted by sovereign governments, not private entities. Any “coin” that a private company might offer is technically a round, rather than a coin.
As such, they are guaranteed to be minted according to statutory guidelines, including the exact amount of silver contained in each one. This level of surety comes at a premium.
Coupled with that pedigree, coins also have some cachet on their own based upon their design or historic significance. Owning a particular coin is a recognizable symbol of the worth of your collection, and other collectors understand as much. If a coin is old and/or has a particular history associated with it – such as the era of its common usage or famous events where it acted as legal tender – there may be additional value granted to it beyond the coin’s metal content.
However, you might have to break out a calculator if you want to buy a round or a bar of silver. It is much more likely that you will find options to buy rounds and bars in either ounces or grams.
Larger pieces are usually measured in kilograms. Finding a pound of any precious metal is a bit of a rarity, rather than commonplace, and we do not currently have silver available in pound increments.
What we do have, however, are many different options for silver buyers. Here are some of the different products – and different weights – that we offer:
The products linked above are an extremely small sample of the different silver options we have for you. However, whether you do business with us or elsewhere, you need to know how the weight of the silver you buy influences the prices and premiums you can expect to pay.
Now, first things first—you don’t actually have to carry a calculator, although it might help. What matters most is that you remember the typical pricing order based on size. Generally speaking, the per-unit price decreases as the size of the silver item increases, due to economies of scale:
This order reflects the increasing sizes of these measurements. Grams are smaller than troy ounces, and troy ounces are smaller than kilograms. If you encounter a pound-based option, remember that it would fit between a troy ounce and a kilogram in weight. A troy pound is about 37% as heavy as a kilogram, and a standard pound is about 45% the weight of a kilogram.
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There are two different elements to consider when it comes to making a silver purchase. The first is the unit cost, or how much you’ll pay if you break down a larger item versus the amount if you buy a singleton of the smaller unit.
The other thing to note is the absolute budget you have available to you. If you have a limited budget, your options for purchase may be more limited, and you may not buy at the best unit cost.
What we mean is that there are savings to be had if you buy silver in larger lots. If you break down the per-gram cost of an ounce of silver, you’ll almost always find that you’re paying less per gram than if you bought each gram separately. The difference in savings can be dramatic, too – hundreds of dollars or more, depending on the size that you’re trading.
For example, consider that 1-kg Sunshine Mercury bar we mentioned above. At present, it is available for around $1100 at today’s prices. However, if you were to purchase 1000 of the 1 gram bars that we linked, you’d pay $3 per bar, totaling $3,000 to match the kilogram purchase. So, if cost savings is important to you and you have the budget for it, it is almost always the correct choice to buy 1 large silver piece over many small pieces.
On the other hand, your budget for silver might not be $1100, or anywhere close to it. Owning silver is still a good plan, though, as it allows you to preserve the value of your wealth over relying on the value of fiat currency. So, you can buy a few of the gram bars and pay less than $100, but still rest comfortably knowing that you’ve diversified your portfolio.
The three measurements for silver pieces above are the most common, to be sure. However, there are a few other denominations that you might encounter and want to explore. In some cases, there are other factors influencing the prices of these options beyond their silver content.
“Junk” silver
“Junk” silver is the catch-all term for coins that contain less than 100% (or as close to it as possible) of silver. Though the name itself may sound a bit pejorative, the truth is that some of these items are popular investment vehicles for collectors of all stripes.
For our purposes, we are only going to discuss the American coins that are considered junk silver. If you happen to find another sovereign coin with only a percentage of silver, adjust accordingly.
American junk silver coins come in one of three silver percentages: 90%, 40%, and 35%. The majority of these pieces are of the 90% variety, and include dimes, quarters, half-dollars, and silver dollars.
Every one of these pieces comes with its own historical value and deep ties to the American experience. Though the silver content is important for determining the value of these coins, it is assuredly not the only factor.
By contrast, the US Mint has only ever released two coins with 40% silver content. Both of them are products of the mid-20th century, and their appearance largely coincided with the Mint’s decision to back away from including silver in its coinage.
So, the first 40% silver coin is the Eisenhower dollar, which was available between 1971 and 1976. The second, the Kennedy half-dollar, was available just prior – between 1965 and 1971.
Finally, the lone 35% silver coin was the nickel issued between 1942 and 1945. These nickels are usually known as “war” nickels, due to the fact that their issuance was a response to the growing need for nickel in the American war effort for World War II.
Fractionals
Another common denomination of weight you’ll find for silver pieces is fractional silver. As the name implies, the coins in this category bear weights that are fractional portions of ounces or, less commonly, grams or kilograms.
At present, we do not offer any true coins that are fractional silver pieces. All of our options are considered rounds, and their value is solely a function of their weight and the spot price of silver.
Pounds
Finally, although it’s extremely unlikely, you may encounter an option to buy a pound of silver at some point. We don’t have such an option, but that doesn’t mean we always won’t, or that you may find one elsewhere.
It’s essential to verify how many ounces are in the pound being offered. A 16-ounce pound is in the avoirdupois system, and you may have to do some calculations if the other offerings are in troy ounces. A troy pound has only 12 ounces.
Now, silver is not the only precious metal to use ounces, grams, and kilograms somewhat interchangeably. Gold, platinum, palladium, and copper use both the imperial and metric systems with their products.
In fact, copper stands somewhat apart from the others in that it is commonly sold in pounds. Be aware – at least with JM Bullion – that the pounds of copper sold are avoirdupois pounds and contain 16 standard ounces of copper, rather than 12 troy ounces.
For the most part, the math associated with converting other precious metals is the same as it is for silver. The only tricky part might be if you attempt to trade one type of metal for another.
Trying to make the two quantities of diverse metals line up in terms of value may prove difficult because the spot prices of the two items are not in proportion to one another. You may find it challenging to match amounts and values, and using two measurement systems can further complicate this process.
However, the main concern for any types of metals is to verify the type of ounces that the metal is using. As long as you know whether they are troy or avoirdupois, converting into metric units should be straightforward.
Other articles of interest:
If you remember just two points from this guide, make them these:
Most importantly, you should remain aware of the type of measurements that you’re seeing when you want to buy or sell silver. Otherwise, mistakes can happen. Be sure to check for the decimals, too – they can mean the difference between a good deal and a bad one.
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