Platinum is a rare, precious metal with a variety of industrial and investment applications. As with any investment, there are pros and cons to investing in platinum, and it’s important to carefully consider your options before making a decision. This article will explore the reasons to invest in platinum, how to invest in platinum, and the differences between platinum and gold as investment assets.
Why Should I Invest in Platinum?
Platinum has several key properties that make it an attractive investment option for those looking to diversify their portfolio. One of the primary benefits of investing in platinum is its scarcity. Unlike gold, which is abundant in the Earth’s crust, platinum is much rarer, and its extraction and production require a significant amount of effort and investment. This scarcity means that the price of platinum is more likely to be affected by supply and demand dynamics, and therefore, to increase over time.
Another reason to consider investing in platinum is its various industrial applications. Platinum is a critical component in a variety of industrial processes, including catalytic converters, which are used in the production of cars, trucks, and other vehicles. As the global economy continues to grow and more and more vehicles are produced, the demand for platinum is likely to increase, driving up its price.
What Are The Disadvantages Of Platinum Investment?
Investing in platinum, like any other investment, comes with its own set of advantages and disadvantages. Here are some of the potential disadvantages of investing in platinum:
- Price volatility: Platinum prices can be subject to sudden and significant fluctuations, which can make it a riskier investment than more stable assets like bonds or cash.
- Limited liquidity: Unlike more widely traded assets like stocks or bonds, the market for platinum can be limited, which can make it more difficult to sell your investment when you need to.
- Industrial dependence: Platinum is heavily used in various industrial applications, and its price is largely influenced by demand from these industries. If demand decreases, platinum prices can suffer.
- Storage costs: Physical platinum, such as coins or bars, may require special storage to protect it from theft or damage, which can add to the costs of holding the investment.
- Market manipulation: Like any other precious metal, platinum can be subject to manipulation by market participants. For example, producers or traders may hoard platinum to drive up prices, or speculators may drive prices up or down based on market sentiment.
It’s important to carefully consider these and other factors before investing in platinum or any other investment, and to seek professional financial advice if you have any questions.
How To Invest In Platinum
There are several ways how to invest in platinum, including physical platinum, exchange-traded funds (ETFs), and futures contracts.
Physical Platinum: You can invest in platinum by purchasing physical platinum bars, coins, or jewelry. Physical platinum is tangible, and you can hold it in your hand, which some investors find appealing. However, it can be more difficult to sell physical platinum than other forms of investment, and it may be more expensive to store and insure.
ETFs: An ETF is a type of investment fund that tracks the price of a specific asset, such as platinum. ETFs are bought and sold on stock exchanges like any other stock, and they provide exposure to platinum without the need to physically own the metal. ETFs are typically more liquid than physical platinum, and they can be a convenient way to invest in the metal.
Futures Contracts: Futures contracts are agreements to buy or sell a specific asset at a specified price on a future date. Investing in platinum futures contracts allows you to take a position on the future price of platinum without having to physically own the metal. Futures contracts are more complex than ETFs and physical platinum investments, and they carry greater risk.
BullionVault: BullionVault is an online platform that makes it easy to invest in precious metals, including platinum, gold and silver. By providing a secure, cost-effective, and accessible way to invest in bullion, BullionVault has become one of the most popular choices for precious metal investors around the world.
One of the main advantages of investing in platinum with BullionVault is the convenience it offers. The platform provides a simple, user-friendly interface that allows investors to buy and sell bullion from their computer or mobile device, 24 hours a day. This eliminates the need for travelling to a physical location or dealing with the time and costs associated with shipping and storage.
In addition to convenience, BullionVault also offers a high level of security for platinum investments. All bullion is stored in professional vaults in major cities worldwide, and each bar is fully insured against loss or damage. This means that investors can be sure their investments are safe and secure.
Moreover, BullionVault is cost-effective. The platform operates on a low-cost business model, allowing it to offer competitive prices on platinum and other precious metals. Furthermore, BullionVault has an efficient system for buying and selling bullion which minimizes transaction fees and helps to maximize returns for investors.
In conclusion, BullionVault makes it easy for investors to invest in platinum and other precious metals. Whether you are a seasoned investor or just starting out, BullionVault offers a convenient, secure, and cost-effective way to invest in platinum and other valuable metals.
Invest in platinum with BullionVault
Is It Hard To Sell Platinum?
Selling platinum can be less challenging than selling some other types of investments, but it may not be as straightforward as selling more widely traded assets like stocks or bonds.
If you have physical platinum in the form of coins or bars, you may need to find a buyer who is willing to purchase the specific form of platinum that you have. Some specialty dealers may be willing to purchase physical platinum, but you may need to do some research to find a buyer.
If you have invested in platinum through exchange-traded funds (ETFs) or futures contracts, selling platinum may be easier, as these investments can be bought and sold like any other stock or futures contract. ETFs, in particular, are highly liquid, and you can typically sell your shares at any time during market hours.
In general, it’s always a good idea to research your options and understand the market dynamics before making any investment. If you have questions about selling platinum, it’s a good idea to seek professional financial advice.
Gold vs Platinum Investment
While platinum and gold share some similarities as precious metals, they have important differences that make them distinct investment assets. One key difference is their scarcity. As mentioned earlier, platinum is much rarer than gold, and its scarcity can lead to higher prices over time. Another difference is their industrial applications. While gold has some limited industrial uses, it is primarily used as a store of value, while platinum is in high demand for its critical role in various industrial processes.
Is Platinum A Better Investment Than Silver?
Whether platinum is a better investment than silver depends on various factors, including market conditions and your investment goals.
Platinum is generally considered a rarer and more valuable metal than silver, and it has a number of industrial uses, including catalytic converters in vehicles, which helps support demand and prices. However, platinum can also be more expensive than silver, which can make it a more expensive investment option.
Silver, on the other hand, is often more widely available and less expensive than platinum, making it a more accessible option for many investors. Silver also has a number of industrial uses and has been used as a form of currency for thousands of years.
Ultimately, the decision between platinum and silver as an investment will depend on your individual financial situation, risk tolerance, and investment goals.
What Metals Are Rarer Than Platinum?
There are several metals that are considered rarer than platinum. Some of these include:
Rhodium: This metal is often used in catalytic converters and is considered even rarer than platinum.
Palladium: Like platinum, palladium is used in catalytic converters and has become increasingly popular as a precious metal investment in recent years.
Iridium: This metal is even rarer than rhodium and is used in specialized applications, such as electrical contacts and spark plugs.
Rhenium: This metal is used in high-temperature alloys and is considered one of the rarest elements in the Earth’s crust.
Osmium: This metal is often used in alloys for electrical contacts and is considered one of the rarest elements in the Earth’s crust.
It’s important to note that the rarity of these metals can be difficult to quantify, as it can depend on a variety of factors, such as the ease of extraction and production. However, these metals are generally considered rarer than platinum and can be of interest to investors looking to diversify their portfolios with precious metals.
Final Thoughts; Should I Invest In Platinum?
A platinum investment can be a great way to diversify your portfolio and benefit from the metal’s scarcity and industrial demand. However, like any investment, there are risks involved, and it’s important to carefully consider your options and understand the market dynamics before making a decision. As with any investment, it’s always best to do your own research and seek professional advice before making a commitment.
Invest in platinum with BullionVault
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