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When you want to get the most out of your long-term investments, owning precious metals like gold and silver is a great solution. However, more people are looking toward platinum products as an alternative way to enhance their portfolios.
Unlike fiat currency, platinum shows resilience during an economic downturn. The following article explains why this precious metal is so attractive to many investors and what you can do to obtain it.
What Affects the Price of Platinum?
Because many modern industries depend on platinum as an essential ingredient in their products, numerous factors influence its value.
The first factor to consider is the available supply of this precious metal. Most of the world’s platinum supply comes from South African mines. However, political developments and worker strikes often put the stockpile at risk.
Depending on the results of these conflicts, the price of platinum can fluctuate.
Second, platinum is a crucial asset to the auto industry. Engineers use platinum as catalytic converters during the manufacturing process. As global markets like China continue to invest heavily in new cars, platinum’s price fluctuates.
Platinum also serves as a durable industrial metal in other applications. New technology uses platinum to reinforce medical equipment, like pacemakers. Engineers also use this metal to reduce the output of harmful gases from diesel engines.
Platinum jewelry has become increasingly popular in the last few years. The World Platinum Investment Council (WPIC) noticed a steep rise in the demand for this product in the Indian and Chinese markets. As a result, the WPIC expects platinum’s jewelry demand to grow to 14% in the coming years.
Jewelry that contains platinum loses very little of its quality over time. Products like white gold jewelry may lose some of its metal when damaged. However, those who invest in jewelry with platinum can simply polish the surface without tarnishing the metal.
The Platinum Investment Industry
Some people buy platinum for its beauty, while others invest in its many industrial applications. A relatively new platinum market emerged in the last few decades, attracting many new investors.
Platinum coins and bars are more popular than ever among the precious metals community. Most well-informed investors understand that this product could be essential to their portfolios.
Like yellow gold and palladium, this alternative precious metal hedges well against inflation and economic crisis. Financial forecasts indicate that the price of platinum could continue to rise as the high demand outweighs the supply.
What Affects the Price of Gold?
Some people view gold as the ultimate profitable investment. For centuries, gold served as many nations’ currencies and was a status symbol among the affluent.
In most places, gold demand indicates how well an economy performs. For example, many thriving economies tend to spend more money on gold jewelry.
The gold standard also protects investors against currency depreciation and volatile markets.
Why Is Platinum Cheaper if It Is Much Harder To Find?
Platinum prices can be much cheaper than those of other precious metals. However, this ratio can change rather quickly.
Less platinum equals higher prices, and more platinum equals lower prices. Platinum is a rare metal that miners must work tirelessly to extract from the earth’s crust.
Despite these numbers, platinum’s supply is relatively high at the time of this writing. Many companies are only now waking up to its potential industrial uses. Until the industrial demand for platinum outweighs production, it could remain less expensive than gold.
Still, rising global markets may encourage manufacturers to start producing more items like catalytic converters and surgical tools. As a result, the value of platinum could skyrocket overnight.
Platinum vs. Gold: Which Is More Valuable?
Gold is your safest bet when you want to invest in precious metals that retain much of their historic value. Many people believe that gold’s stability makes it a good investment. Nevertheless, analysts consider platinum to be more valuable than gold.
In a stable market, platinum can overtake the price of gold. However, as previously mentioned, platinum and gold values depend heavily on major producers’ output.
Platinum Price Trends Compared to Other Precious Metals (2020–2022)
How do other metals stack up against the price of platinum and gold? The price differences between these commodities tend to follow similar trends: As one metal becomes more expensive, others follow suit.
However, these trends indicate that some metals rise and fall more dramatically than others.
Since the second quarter of 2020, silver has been more expensive than gold and platinum. This phenomenon may be due to the effects of COVID-19. Many investors began buying up this product as the stock market dropped significantly.
However, since March 2022, silver prices have continued to return to pre-2020 levels.
Palladium is also more valuable than gold and platinum. It briefly fell below the price of gold in November of 2021 but continues to trend back up.
Palladium is a high-demand precious metal in low supply. We can conclude that its rarity contributes to this price difference.
Is Buying Platinum Worth It Right Now?
Just like when dealing with traditional stocks, it’s wise to buy low and sell high. Platinum is currently at one of its lowest prices since 2020. Some may consider purchasing these items now before platinum demand increases.
Still, every investor’s situation is different. Partnering with a financial advisor is the best way to get the most out of your portfolio. They can help you assess platinum prices and determine whether this investment suits you.
Gold Rings, Alloys, and Other Commodities: Are They Worth Anything?
Gold rings, bullions, and bars are some of the most attractive commodities for investors worldwide. Some of the most recognizable alloys include white gold, yellow gold, and rose gold. Still, you may wonder whether it is worth investing in any of these items.
For example, platinum and white gold are different in many ways. How can you be sure your money is going toward the right investment? Let’s take a look at each of these products more closely.
Platinum and White Gold
White gold contains around 75% pure gold. Jewelry manufacturers use this metal regularly in their products. Its naturally white surface distinguishes it from other gold alloys that contain yellowish metal.
For some, it may be challenging to differentiate between platinum and white gold. For example, gold and platinum contain silver-colored metal that is ductile and malleable. However, buyers may notice some key differences between the two.
Unlike platinum, white gold is difficult to dent or scratch. Its durable white metal surface contains trace amounts of silver, copper, and palladium.
Additionally, wearing a platinum ring may be safer than wearing a white gold ring. White gold sometimes contains nickel, which can cause allergic reactions for some.
Platinum and Yellow Gold
Yellow gold is another alloy that contains metals like copper and zinc. Customers will notice few differences between this product and white gold. However, people sometimes mistake this yellow metal for having a higher purity.
Both alloys have approximately the same market value. Choosing between these two options boils down to personal preference.
Investing in either option may be practical if you can afford it. However, platinum continues to outclass in terms of quality and value.
Platinum vs. Gold: Finding the Right Precious Metal for Your Portfolio
Platinum and gold are two metals that yield significant advantages for investors. Platinum prices may offer higher long-term rewards for those who hold on to their products. However, gold appears to be a better investment for those seeking stability.
Our accessible, one-stop shop allows you to explore dozens of platinum options from the comfort of your home.