Although gold may have a lot of history on its side, in reference to investing in a precious metal, platinum makes the best 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 gold's by roughly 10 percentage points. This is the first time that this has ever happened. 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.
In 2008 the market was said to be volatile. There were on going production problems at South African mines and because of the high energy prices this drove up recovery costs, making the price of platinum soar to $2,250 an ounce. When the economy plummeted, it slumped down to $774 an ounce. By putting down roughly 10% in margin money you can buy a 50-ounce futures contract (worth $80,000) on the New York Mercantile Exchange.
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 far 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 U.S. platinum mine, and North American Palladium, which operates in Ontario, Canada. The PLTM charges 0.7% annually and holds 25 stocks.
Owning a few well managed companies and a few more that aren't well managed are the only trouble some 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. He chose his top three holdings very carefully and they consist of and they compromise 22% of fund assets Lonmin, Johnson Matthey and Impala Platinum. His annual expenses are approximately 0.39%. His choice to hold on to this platinum stock even in times of volatile drops may be one of the smartest things he has done.
In 2008 the market was said to be volatile. There were on going production problems at South African mines and because of the high energy prices this drove up recovery costs, making the price of platinum soar to $2,250 an ounce. When the economy plummeted, it slumped down to $774 an ounce. By putting down roughly 10% in margin money you can buy a 50-ounce futures contract (worth $80,000) on the New York Mercantile Exchange.
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 far 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 U.S. platinum mine, and North American Palladium, which operates in Ontario, Canada. The PLTM charges 0.7% annually and holds 25 stocks.
Owning a few well managed companies and a few more that aren't well managed are the only trouble some 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. He chose his top three holdings very carefully and they consist of and they compromise 22% of fund assets Lonmin, Johnson Matthey and Impala Platinum. His annual expenses are approximately 0.39%. His choice to hold on to this platinum stock even in times of volatile drops may be one of the smartest things he has done.
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Platinum is always a good choice jewelry. It will never let you down.
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