Platinum is one among the most valuable metals in the world. This versatile metal is found very rarely and is used in catalytic converters and as jewellery. It has many industrial processes and auto industries and has become the most popular metal used as jewellery because of its rarity and quality. It is very durable and never tarnishes. Most of the produced platinum is made use for different industrial purposes.
Only a few of that is used for investment. One can depend on precious metal bars and coins to stabilise their investment portfolio. To make the investment shine, get the perfect bars from the array of sizes offered by metal specialists. People have different reasons for investing in platinum. Let us consider why investing in this precious metal matters.
Coins, Bars and the Demand-supply Curve
Platinum is fashioned into bars and coins of different sizes for investing. This fashioned metal in the hands of the investors is only a small share of what is produced in the world. And its production is much less compared to that of silver and gold. So, only a small amount of the metal is available for investing. This is very beneficial for the investor as the availability of the metal is very low, and its demand will be very high. This can push up the price considerably. The platinum market highly depends on the economic climate of South Africa as the majority of these metal reserves in the world is located in that country. The economic and political condition of the country influences the rise and fall in the price of the metal. So, it is advisable to look at the demand-supply dynamics and see whether the price increases before buying the metal.
Reduce Investment Risk
Generally, alternate investments are made besides stocks or bonds for economic safety and to diversify the portfolio. Investing in platinum is aimed at acquiring capital appreciation and hedging the portfolio. It is a very volatile investment with highly fluctuating prices. At times, its price will move dramatically, which helps in reducing the risk. The platinum market and the stock market mostly correlate inversely. But it may go together at times, so it is crucial to consider the market conditions while investing in the metal. Understand the direction of the trend and may guide one’s investment decisions.
Play the Market
Platinum is a very volatile asset which makes it the most desirable precious metal to speculate on as an asset. The metal’s prices fluctuate pretty significantly, reaching their lows and highs. The timely intervention will enable people to accumulate capital significantly. Unlike stocks or bonds, holdings of any precious metals are not suitable for a long-term period.
Even though one can speculate on it for short and long time frames, they can do better as a short-term investment. Once invested, the positions should be properly timed according to the market trends. Then only one could make enough money out of the holdings. One should use technical approaches to predict the change in prices and trade accordingly. People who take the right step at the right time will make incredible monetary benefits from long or short term platinum holdings. One who possesses the skill of using charts and indicators to anticipate the price changes can easily translate their skills to monetary gains.