Investment in

platinum Platinum is a chemical element; it has Symbol (chemistry), symbol Pt and atomic number 78. It is a density, dense, malleable, ductility, ductile, highly unreactive, precious metal, precious, silverish-white transition metal. Its name origina ...

is often compared in financial history to

gold Gold is a chemical element; it has chemical symbol Au (from Latin ) and atomic number 79. In its pure form, it is a brightness, bright, slightly orange-yellow, dense, soft, malleable, and ductile metal. Chemically, gold is a transition metal ...

and

silver Silver is a chemical element; it has Symbol (chemistry), symbol Ag () and atomic number 47. A soft, whitish-gray, lustrous transition metal, it exhibits the highest electrical conductivity, thermal conductivity, and reflectivity of any metal. ...

, which were both known to be used as money in ancient civilizations. Experts posit that platinum is about 15–20 times scarcer than gold and approximately 60–100 times scarcer than silver, on the basis of annual mine production. Since 2014, platinum prices have traded at a discount to gold. A significant portion of global platinum is mined in

South Africa South Africa, officially the Republic of South Africa (RSA), is the Southern Africa, southernmost country in Africa. Its Provinces of South Africa, nine provinces are bounded to the south by of coastline that stretches along the Atlantic O ...

Overview

Platinum Platinum is a chemical element; it has Symbol (chemistry), symbol Pt and atomic number 78. It is a density, dense, malleable, ductility, ductile, highly unreactive, precious metal, precious, silverish-white transition metal. Its name origina ...

is extremely

scarce In economics, scarcity "refers to the basic fact of life that there exists only a finite amount of human and nonhuman resources which the best technical knowledge is capable of using to produce only limited maximum amounts of each economic good. ...

even when compared to other

precious metals Precious metals are rare, naturally occurring metallic chemical elements of high economic value. Precious metals, particularly the noble metals, are more corrosion resistant and less chemically reactive than most elements. They are usual ...

. New mine production totals approximately less than each year. In contrast, gold mine production runs approximately annually, and silver mine production is approximately annually. Platinum is traded on the

New York Mercantile Exchange The New York Mercantile Exchange (NYMEX) is a commodity futures exchange owned and operated by CME Group of Chicago. NYMEX is located at One North End Avenue in Brookfield Place in the Battery Park City section of Manhattan, New York City. ...

(NYMEX) and the

London Platinum and Palladium Market The London Platinum and Palladium Market (LPPM) is an over-the-counter trading centre for platinum and palladium and a commodity trading association. London has always been a centre for the research in and development of most of the platinum grou ...

. To be saleable on most international markets, platinum

ingot An ingot is a piece of relatively pure material, usually metal, that is Casting, cast into a shape suitable for further processing. In steelmaking, it is the first step among semi-finished casting products. Ingots usually require a second procedu ...

s must be

assay An assay is an investigative (analytic) procedure in laboratory medicine, mining, pharmacology, environmental biology and molecular biology for qualitatively assessing or quantitatively measuring the presence, amount, or functional activity ...

ed and

hallmark A hallmark is an official Mark (sign), mark or series of marks struck on items made of metal, mostly to certify the content of noble metals—such as platinum, gold, silver and in some nations, palladium. In a more general sense, the term ''Wikti ...

ed. Platinum is traded in the

spot market The spot market or cash market is a public financial market in which financial instruments or commodities are traded for immediate delivery. It contrasts with a futures market, in which delivery is due at a later date. In a spot market, s ...

with the

code In communications and information processing, code is a system of rules to convert information—such as a letter, word, sound, image, or gesture—into another form, sometimes shortened or secret, for communication through a communicati ...

"XPT". When settled in United States dollars, the code is "XPTUSD".

Investment vehicles

Exchange-traded products

Platinum is traded as an ETF (

exchange-traded fund An exchange-traded fund (ETF) is a type of investment fund that is also an exchange-traded product, i.e., it is traded on stock exchanges. ETFs own financial assets such as stocks, bonds, currencies, debts, futures contracts, and/or comm ...

) on the

London Stock Exchange The London Stock Exchange (LSE) is a stock exchange based in London, England. the total market value of all companies trading on the LSE stood at US$3.42 trillion. Its current premises are situated in Paternoster Square close to St Paul's Cath ...

under the ticker symbol and on the

New York Stock Exchange The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District, Manhattan, Financial District of Lower Manhattan in New York City. It is the List of stock exchanges, largest stock excha ...

as ticker symbols and There are also several ETNs (

exchange-traded note An exchange-traded note (ETN) is a senior, unsecured, unsubordinated debt security issued by an underwriting bank or by a special-purpose entity. Similar to other debt securities, ETNs may have a maturity date and are backed by the credit of th ...

) available.

Platinum coins and bars

Platinum bars are available from different foundries in different sizes, beginning at 1 gram, on up to 1 oz, and even 10 oz and 1 kg bars.

Platinum coin Platinum coins are a form of currency. Platinum has an international currency symbol under ISO 4217 of XPT. The issues of legitimate platinum coins were initiated by Spain in Spanish-colonized America in the 18th century and continued by the Rus ...

s are another way to invest in platinum. Since 1997, the

United States Mint The United States Mint is a bureau of the United States Department of the Treasury, Department of the Treasury responsible for producing coinage for the United States to conduct its trade and commerce, as well as controlling the movement of bull ...

has been selling

American Platinum Eagle The American Platinum Eagle is the official platinum bullion coin of the United States. In 1995, Director of the United States Mint Philip N. Diehl, American Numismatic Association President David L. Ganz, and Platinum Guild International Execu ...

coins to investors.

Jewelry as investment

Jewelry has long been a store of wealth in countries such as

India India, officially the Republic of India, is a country in South Asia. It is the List of countries and dependencies by area, seventh-largest country by area; the List of countries by population (United Nations), most populous country since ...

, with platinum increasingly popular as a metal of choice for jewelry in the nation with one of the highest cultural tendencies for jewelry purchases for both gifts and for investment. This method of preserving wealth to pass on to one's heirs is also popular in Europe as well as the United States.

Accounts

Most

Swiss bank Banking in Switzerland dates to the early 18th century through Switzerland's merchant trade and over the centuries has grown into a complex and regulated international industry. Banking is seen as very emblematic of Switzerland and the countr ...

s offer platinum accounts where platinum can be instantly bought or sold just like any foreign currency. Unlike physical platinum, the customer does not need to touch or come into physical possession of the actual metal but rather has a claim against the bank for a certain quantity of metal.

Futures

Another investment option is to create a futures contract where a predetermined time and place is designated to buy or sell the platinum. Unlike options, the transaction is an obligation, and not a right. The

(NYMEX) and the

Tokyo Commodity Exchange The , or TOCOM, is an energy exchange in Tokyo, Japan. TOCOM is operated by , a wholly owned subsidiary of Japan Exchange Group (JPX). Under the of Japan, It is a licensed commodity exchange operator that provides market facilities for trading ...

(TOCOM) trades in platinum futures with a minimum contract size of 50 troy ounces and 500 grams respectively.

Other

Additional methods of investing in platinum include owning shares in mining companies with substantial platinum assets or exposure, as well as owning traded options in platinum.

References

External links

Information about Platinum as a commodity from New York Mercantile ExchangeLondon Platinum and Palladium Market
{{Webarchive, url=https://web.archive.org/web/20080623023211/http://www.lppm.org.uk/ , date=2008-06-23 Platinum Precious metals as investment Commodities used as an investment Precious metals