Just wondering if anybody is getting behind platinum over gold or silver? Why do you think platinum has a better potential than other PM's? If you don't, why not?
I think platinum isn't as exchangeable on the local markets as gold and silver, for that reason alone, I stick to those. I'm also not certified in any sort of economics, business, or metallurgy so take that with a grain of salt.
I used to have some Platinum proof eagles. I sold them for spot. But people are enamoured by Gold and Silver. That's the primary metal they make jewelry out of so people are used to it. Yes they make jewelry out of platinum too but I think sales pale in comparison. I've thought of getting a few Proof Platinum Eagles again just because I like the designs. But since Platinum prices have dropped below Gold it doesn't seem like a good PM investment. Since Platinum is used in the automotive field and there are 2 other alternatives to it they can swap if the price gets too high, thus the reason you see Palladium and Rhodium in the market. Matter of fact, I've moved away from the concept of owning any physical PMs for investment only purposes and will only do PM ETFs. Then when you add the cyclical nature of PMs you simply have to wait to buy PMs when they are low. So I'm going to set aside a stable investment of bonds or something which I'll use to electronically cash in to convert to a crash in the PM market. I don't really want to have to sit on an investment for years waiting for a hopeful good return. If you look at a long trend of Platinum prices you get this ... If you slice it and dice it you can make it show anything that you want to show. And compare it to Gold But platinum is like any other investment. Determine your IN price, and determine your OUT price whether UP or DOWN in order to gather gains or to preserve losses. But think of it this way. Where is the demand for Platinum? is it in coinage? If so, why are there so few options out there? And thus how is the demand/supply for platinum managed and how would that affect future supply. Keeping in mind for automotive consumption there are 2 other alternatives available if the price gets too high.
I would love to own more platinum, but the premiums are simply sky high. If I could buy platinum coins near spot, I would probably own 10 ounces. That is the problem with metals other than gold/silver. Much higher buy/sell price spreads. If you buy from large dealers, you need to have the market move up a LOT just to break even.
I forgot I do have a 2000 US Bi-metal Gold/Platinum Library of Congress coin. I think it has a low numismatic demand.
Interesting thoughts, thank you all for your input. I bought a half ounce on 10/21 in hopes that it would rise above the price of gold this next year. I agree the premiums are pretty bad...I paid nearly 15% over spot, but have nearly made it back with the recent gains platinum has made--notably, in the last hour (CHECK THE DOW FUTURE)
Platinum used to be worth a bit more than gold but the ratio has changed, but why? Platinum is much rarer than gold...Platinum Proof Eagles are a bargain in my book...beautiful, low mintage, and cheap. I would buy more if I could.
Simple answer, it is much rarer than gold, but it has a pretty low demand - primary industrial usage is for catalytic converters in the exhaust systems of vehicles. It doesn't have nearly the history that gold and silver have. It really was only isolated and used in the last 400-500 years. Both gold and silver have much higher demand and more industrial applications. They also have a long history of being recognized as a representative monetary instrument. Russia briefly minted platinum coins in the 1830s and 1840s, but they were soundly rejected in commerce. Later on as platinum became easier to isolate and work, counterfeit coins were minted in gold plated platinum, quite common for late 1860s and early 1870s counterfeit gold coins. Gold and platinum have a similar atomic weight and density.
