Gold Loan Calculator Details

• Weight of Gold : 10 grams
• Purity : 22 Karat
• Gold Rate(24K) : ₹1,45,525
• Loan-to-Value (LTV) Ratio: 75%

1. Convert 24K Gold Rate (10g) to 1g: Since the market rate is usually quoted for 10 grams of 24K gold, we first convert it to the price per gram.
Price per Gram (24K) = Gold Rate (24K/10g) / 10
e.x : ₹1,45,525 / 10 = ₹14,552.50

2. Calculate Price for specific Purity (Karat): The price for other purities (22K, 18K, etc.) is calculated proportionally based on the 24K rate.
Price per Gram (22K) = Price per Gram (24K) × (K / 24)
e.x : ₹14,552.50 x (22/24) = ₹13,339.79

3. Apply Hedging: We apply a 10% hedging factor to the gold rate to protect against market volatility.
Hedged Gold Rate = Price per Gram (K) × 0.90
Based on the example above:
Hedged Gold Rate (24K) = ₹13,339.79 × 0.90 = ₹12,005.81

4. Calculate the total value of gold: Multiply the net weight of the gold (Gross Weight - Stone Weight) by the hedged price per gram of the selected purity:
Total Value of Gold = Net Weight × Price per Gram (K)
For example, if the net weight is 10g and the hedged price per gram for 22K gold is ₹12,005.81 (derived from ₹1,45,525/10g 24K rate), then:
Total Value of Gold = 10g × ₹12,005.81/gram = ₹120,058.12

5. Calculate the loan amount: Apply the Loan-to-Value (LTV) ratio to the hedged value:
Loan Amount = (Net Weight × Hedged Gold Rate) × (LTV Ratio / 100)
For example, with 10g net weight, ₹12,005.81 hedged rate, and 75% LTV:
Loan Amount = (10 × ₹12,005.81) × (75 / 100) = ₹90,043.59

Gold Asset Value (Hedged):

₹120,058.12

Calculated Loan Amount:

₹90,043.59