All eyes are most often focused on gold and silver prices, but there are other options in the precious metals market. Options that offer very attractive opportunities today. Today. I’ll tell you why you need to buy platinum….and why you also should look at buying palladium.
So why should you own platinum in the first place? The anser to that questions is twofold. Part of the answer has to to with the out of control spending of the worlds governments which is leading to a competition in devaluing currencies. The other part of the answer has to do with industrial demand. Platinum is an industrial metal as well.
There is a very attractive supply-demand setup for platinum today.
The production of platinum is falling in the worlds biggest producer – South Africa. The explanation for this is that producers are simply earning enough money to cover their production costs and expenses. A lack of supply will push prices higher.
When it comes to platinum it doesn’t have a large above ground supply like that of gold. It’s more similar to silver in the sense that a large portion of the annual production is used for industrial purposes. In platinums case there is a strong demand from smog-reducing catalytic converters.
As is illustrated by the graph below the price for platinum has taken a hit together with gold and silver over the course of the last few months. Current prices are around 24% below the peak from 2011.
Palladium offers the same type of set up as platinum although the case and opportunity isn’t as strong as with palladium. See the graph below for illustration of the most recent palladium price performance.
In coming posts we are going to take a closer look at platinum and palladium production, supply and demand factors.
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