What is a troy ounce?

A troy ounce is a unit of mass used for weighing precious metals such as gold, silver, and platinum. The standard ounce, also known as the avoirdupois ounce, is commonly used as a unit of weight in the United States. However, the troy ounce differs from this. A standard ounce is approximately 28.349 grams, while a troy ounce is about 31.103 grams. The troy ounce is a specific weight used exclusively in the trading of precious metals.
 

The origin of the troy ounce

The troy ounce is named after the French city of Troyes, an important trading hub. In this city, a trading system was developed for weighing precious metals, and this system was adopted by traders across Europe. The troy ounce was officially standardized by the British Empire in the nineteenth century, and later by other countries, to ensure precision and uniformity in the precious metal trade. Today, the troy ounce remains the standard unit for both weighing and trading precious metals worldwide.

Difference between troy ounce and avoirdupois ounce

As previously mentioned, a troy ounce equals approximately 31.103 grams, while an avoirdupois ounce is about 28.349 grams. The weight difference is evident, but this is not the only distinction. The difference also lies in the systems they originate from. The avoirdupois ounce is part of the widely used avoirdupois system, which counts 16 ounces per pound. In the troy system, there are only 12 troy ounces per troy pound. This difference affects the value and accuracy of transactions, making it a crucial distinction in the trading of various precious metals.

Impact of troy ounce on investments

The troy ounce is crucial for the valuation of precious metals, directly impacting investments. Internationally, precious metal prices are quoted in troy ounces, meaning investors worldwide use this measurement to evaluate their investments. Fluctuations in the price per troy ounce can have significant effects on the market value of investments in precious metals.

Disclaimer: The Silver Mountain does not provide investment advice, and this article should not be considered as such. Past performance is not indicative of future results.