Although gold may have a lot of history on its side, in reference to investing in precious metal, platinum makes the best is platinum better than gold choice. Platinum is dearer, rarer, and just as beautiful. Also, because it is unlike gold, it has become very important in industrial use like in automotive catalytic converters and LCD TV screens. Platinum is now easier than ever to buy and sell due to the launch of the new exchange-traded funds. The price of platinum tends to usually be lower than gold when times are bad but then will outperform when things recover. In the past three months, platinum prices have been higher than golds by roughly 10 percentage points. Recently, an ounce of platinum at $1,600 buys approximately 1.4 ounces of gold, when back in May 2008, an ounce of platinum bought about 2.4 ounces of gold..
The other great thing about platinum is that it is still physically in demand. In 2010, jewelers used about 35% of the platinum supply. Platinum has the largest market in China which is up about 25% since 2006. Platinum is the most inspirational metal for Asians, especially as the fashion trends are in favor of white-toned jewelry.
Mining companies play a big part in platinum, although shares for platinum tend to be more than any other metal. Some of the biggest South African miners are Aquarius Platinum, Impala Platinum, and Lonmin. Norilsk Nickel is the biggest Russian producer of platinum but that isn’t his main focus. Also, Johnson Matthey is the leading catalyst maker. The First Trust ISE Global Platinum Index Fund (PLTM) which is an exchange-traded fund owns the two North American platinum players which are Montana’s Stillwater Mining Company, which runs the biggest.
Owning a few well-managed companies and a few more that aren’t well managed are the only troublesome part of an index fund. Actively managing Vanguard Precious Metals and Mining Fund may be a better way to own platinum stocks. The active manager Graham French has had his money on Platinum for many years and his foreseeing was right
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