Before Investing in Platinum

Investors looking to diversify their portfolio and securing their investments in stock market against crash and economic insta often invest in precious metals. Gold and silver have been recognized as valuable since the dawn of time and have been used as money since centuries, but it is platinum that is the most-sought after precious metal and is grabbing all eyeballs as of now. And ever since platinum has emerged as a potential investment option, there have been several debates and arguments about which of the two is better – gold or platinum? If you are looking to invest in platinum but know little about it, this blog post will serve as a guide in providing a few vital tips on platinum investing.

The demand for investing in platinum has increased over the years because it is expensive. A scarce and non-corrosive metal, it has a small market share and continues to be a popular choice for investment for many. Supply being limited; there is a demand for platinum, making it pricier. The fetching price is also higher because of the complexity involved in the refinement procedure. Being an eco-friendly precious metal, the demand for it will increase in the coming years. Platinum is touted to be one of the safest and popular choices of investments especially for growing economies.

Before investing in platinum, begin by purchasing in small quantities based on budget, price per ounce and investment vehicle. Online purchasing of platinum is also possible only if the dealer is reputed, can be trusted, and has been in the business for the last one decade. Alternatively, some banks and credit unions also trade in platinum. Ideally, investors should invest in platinum when there is low price movement. Investors can also look to purchasing physical platinum in the form of coins, bullions, bars etc.

Platinum fetches good returns because this metal is extensively used in many industries and the demand for it is higher too. Unlike gold that fares well only when the economy is not doing well, platinum fetches best prices even when the economies are stable. However, investors should always assess the market conditions before thinking of fetching great returns. Platinum investment is suitable for those investors looking to invest long-term.

The value of platinum is not dependant on the US dollar at all and so the volatile fluctuation of the US dollar has no bearing on its price. Platinum is increasingly being used in automobile and manufacturing sectors because of which the demand for platinum will only swell with time. Unlike gold, the price of platinum does not falter too much with a few fluctuations. Platinum is a liquidable investment and can be exchanged for cash easily. Moreover, investors can also opt for IRA eligible platinum bullion that comes with tax benefits and steady income at the time of retirement.

On the flip side, nothing much is known about the financial history of platinum, discouraging most from risking investing it. Storing physical platinum can be a nuisance. Insurance and storage costs are additional. Most investors are also wary about experimenting with other precious metals besides gold and silver. High spot price may deem it unpredictable.

Now that you are aware about the pro and cons of investing in platinum, do so after much speculation and seeking professional advice. Even if you want to invest in it, it can stabilize your portfolio but cash in only when the market conditions are appropriate.

Gautam Kumar (have 93 posts in total)

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