In the financial past, gold and silver, which were both known to have been employed as currency in ancient civilizations, are frequently contrasted with platinum as an investment. Based on annual mine production, experts estimate that platinum is roughly 15-20 times rarer than gold and roughly 60–100 times rarer than silver. Prices for platinum have decreased less since 2014 than for gold. South Africa produces over 75% of the world’s platinum through mining.
Even among the precious metals, platinum is rather rare. The annual production from new mines is just about five million troy ounces (160 t). In contrast, the annual production of silver is roughly 547,000,000 troy ounces (17,000 t) and 82,000,000 troy ounces of gold are produced in mines. Because of this, platinum typically trades at higher unit prices.
The London Platinum and Palladium Market and the New York Mercantile Exchange (NYMEX) are the two markets where platinum is traded. Platinum ingots must be tested and hallmarked similarly to how gold and silver are to be allowed to be sold on most commodity markets.
The price of platinum varies with supply and demand; during prolonged periods of economic stability and growth, it can be up to twice as expensive as gold. In contrast, during times of economic uncertainty, the price of platinum tends to fall below the cost of gold, in part because of higher gold prices. The price of platinum reached an all-time high of US$2,252 per troy ounce in March 2008, spurred by production worries (partially brought on by issues with power delivery to South African miners). Later, in November 2008, it dropped to US$774 per troy ounce ($25/g). The spot price of platinum in New York on November 21 of 2022 was $980 per ounce, as opposed to $1,742 for gold and $20.84 for silver. The spot market trades platinum under the symbol “XPT”. The code is “XPTUSD” when settlement is done in US dollars. The price of other platinum group metals, especially palladium, increased significantly as the price of platinum per ounce decreased. Palladium currently costs roughly US$1900 per ounce, while platinum costs US$980 as of November 2022.
Investing In Platinum
Products traded on exchanges
On the London Stock Exchange, platinum is traded as an ETF (exchange-traded fund), while on the New York Stock Exchange, it is traded under the tickers PPLT and PLTM. Several ETNs (exchange-traded notes) are also offered, some of which are inversely correlated to the price of platinum.
gold and platinum bars
Different foundries offer platinum bars in a variety of sizes, including 1 oz, 10 oz, and 1 kilogram. Another way to invest in platinum is through platinum coins, albeit there aren’t many different kinds available because it’s expensive and difficult to deal with. Investors can purchase American Platinum Eagle coins from the United States Mint since 1997.
As an investment, jewelry
Jewelry has traditionally been used as a store of wealth in nations like India, but during the late 2010s, it has also gained favor in Europe and the United States as a way to hold value to pass on to one’s heirs.
The majority of Swiss banks provide accounts for platinum, which can be promptly purchased or traded exactly like any other foreign money. In contrast to physical platinum, the consumer does not actually possess the metal; instead, they have a claim on the bank for a specific amount of metal.
Another investment choice is to set up a futures contract with a set time and location for buying or selling platinum. The transaction is an obligation rather than a right, in contrast to options. The minimum contract sizes for trading platinum futures on the New York Mercantile Exchange (NYMEX) and the Tokyo Commodity Exchange (TOCOM) are 50 troy ounces and 500 grams, respectively.
Spread betting or contracts for differences on the price of the metal, owning shares in mining firms with significant platinum assets or exposure, and purchasing traded options on platinum (only accessible on the US market) are further ways to invest in platinum.