How much gold is in a gold watch? Like in this popular model, the Rolex Day-Date 40, reference numberĀ 228238, which is going for around 39,000 dollars right now in the market. Can you guess what portion of that price is actually due to the value of gold?… Take a wild guess… Would you say 50%, maybe 60? Hold that thought for a moment and by the end of the article, comment how close you really were! In the meantime, let’s talk a bit about gold…Ā
You know, that shiny metal worth about $1900 an ounce(61$/g) as for October 2020? Gold is actually a pretty popular investment, outperforming the US stock market in the last 20 years.
From 2000 to 2020, you would have multiplied your investment in gold by 7 times. That’s more than double the return of the S&P 500 during the same period, and that’s assuming all dividends were reinvested, which doesn’t always happen.
Excluding dividends, itās 4 times more! A huge difference!!!
But back to our little Rolex experiment. To find out how much gold the watch really contains, we need to weigh all the parts made out of actual gold… To do that, we took a watch apart.
Even though the hands of a Rolex watch are also made out of gold, they weigh less than a 10th of a gram. That’s at most a few dollars in today’s market. As a result, we excluded them from our actual calculation.
It is also important to note that a gold watch is not made out of pure gold. It is made out of 18K gold, which is around 75% gold by weight.
We then weigh each gold piece one by one to come up with the final weight…
178.3 grams
178.3 grams of 18K gold x 0.75 gives us a total of around 133.7 grams of pure gold, times $61 a gram we get $8,156, which is around 20% of the actual price of the watch. Surprised?
Compare it to the chunk of pure gold in the image below. Let’s see how it compares to the 133.7 grams of pure gold in our Rolex watch.
340.5 grams of 24K gold are worth about 20,770 dollars, more than two and a half times the gold value of our Rolex watch. So, as far as our experiment goes, only about a fifth of the value of this Rolex watch actually comes from gold.
This varies somewhat from watch to watch, but not by a lot, and it shows that most of the value of a Rolex designer luxury watch doesn’t have anything to do with its precious metal content. Now itās time to see how well you did. Was your guess close to the 20% figure or way off? Let us know in a comment below. And make sure to subscribe to our replica Rolex newsletter to find out when we post more articles like this! Thanks for reading!