Is Platinum too Cheap?

in #steemsilvergold6 years ago

Golden greetings, silver salutations, and platinum pleasantries! I am a huge fan of silver. When people ask me why I choose it over gold, the first thing I usually cite is the ratio from gold to silver. The ratio is about 1 to 77, so for every ounce of gold you buy you can buy 77 ounces of silver (using current pricing on Kitco.com). This ratio is historically high and that has made me thinking it greatly undervalued. However, there is another precious metal with an interesting case, that I think deserves your attention.

At the time I write this, Kitco gold pricing is $1,318.80. Platinum on the other hand, is $968. So if I estimated that, platinum is worth about 75% of an ounce of gold. According to Wikipedia "Experts posit that platinum is about 15–20 times scarcer than gold, on the basis of annual mine production.". So platinum is significantly more rare, yet is cheaper than gold.

Source https://en.wikipedia.org/wiki/Platinum_as_an_investment

Also, historically, platinum has been more expensive. Take a look at this 5 year gold to platinum ratio chart.

g to p ratio.JPG

It looks like that that gold had become more expensive than platinum prices around January 2015 (see the 1:1 ratio) and has not looked back. Prior to that it looks like they had similar pricing. But if you look back much farther, say 20 years back, that clearly is not the case. Prior to 2009, platinum had constantly remained more expensive than gold.

GP20.JPG

Both Charts Source: http://www.denvergold.org/precious-metal-prices-charts/gold-to-platinum-ratio

Like my beloved silver, platinum has industrial uses too. Its Wiki page says it is "used in catalytic converters, laboratory equipment, electrical contacts and electrodes, platinum resistance thermometers, dentistry equipment, and jewelry". It goes on to say that "Compounds containing platinum, such as cisplatin, oxaliplatin and carboplatin, are applied in chemotherapy against certain types of cancer." So not only is it rare, it is useful in industry, and saves lives.

Source https://en.wikipedia.org/wiki/Platinum

What is gold good for? It's Wiki says "The consumption of gold produced in the world is about 50% in jewelry, 40% in investments, and 10% in industry. So most of the mined gold is used in making pretty things and this:

GS.JPG

Information Source https://en.wikipedia.org/wiki/Gold#Consumption and the photo souce is https://www.ranker.com/list/goldschlaeger-facts/jordan-love

I have been reading lots of #steemsilvergold entries into #stackingoals. Many of them list wanting to obtain gold this year, yet few mention platinum. I think that maybe people should replace some of the gold on their wishlist for some platinum coins. But what do I know? I know I am not a licenced financial adviser, so do what you like.

TL:DR As Kid Rock said repeatedly in "Devil Without a Cause" - I'm going Platinum!

Keep stacking and supporting #steemsilvergold and #thealliance!

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You're killing it with the posts man, keep it up. A very wise investor told me over a year ago to scoop up my first oz of platinum over a year ago and I didn't listen. All my funds were going to Bitcoin and ethereum.

It has definitely shot up this past year. I saw that chart and I was kicking myself for not picking up a little in the high $800s.

I love Pd almost as much as silver but if Pd and Gold are higher than Pt. Unless they are all overvalued Pt is the buy for me.

PD has been more expensive than PT for a while now. I am not really sure why.

@mikeshuh
Thank you for sharing this. :-)

If we talk about precious metals it´s a long term thing - in my opinion.

Buying gold, silver, platinum, ..., with the goal to sell it after a short period of time could go wrong.
Look at all the gold-talk which was going on, after gold hit 1300 finally. We had it at 1800 also.
I started to buy silver ounces 7 years ago and bought the cheapest for about 14€. Due to the raise of the silver price I also had to pay about 30€ for one ounce.
But for me it´s a long term bet and I really don´t care if gold is up 50$ or 100$. Neither if silver is going up 5$ or 10$.
Its a long term bet as I just said. And therefore it takes time and the big moves will come. But I don´t know if it happens in 5 years or in 15years.

But I know one thing: I own my silver physically. There is no piece of paper with some numbers on it... It´s just the physical silver. And that´s all what counts if you invest in precious medal on the long run.

...just my 2cts...

The classic saying "If you don't hold it, you don't own it " seems to apply as most would agree with you.

First off, welcome to Steemit! I saw your 25 rating (now 26, after a few upvotes from me ☺) so I knew you were new here. I suggest you check out the SteemSilverGold community. There are a lot of silver stackers on Steemit and with well written comments like this one, you'll do just fine around here! If you want see everything tagged with SteemSilverGold, scroll up on this post and look for the tags. Then click on "steemsilvergold".

SSG.JPG

Thank you, I´ll check it out :-)

Haha, Yes! You beat me to it @goldmatters! Too funny 😁

Good stuff @mikeshuh! I like platinum myself. One thing to keep in mind, platinum and silver are both relatively small markets, in regards to volume traded, versus Gold. Basically both the silver and Platinum prices are much easier to suppress, because they are smaller.

Gold is a much harder market to contain due to volume. When Governments worldwide are buying up record amounts of gold, and Russia and China are trading oil in Gold, instead of the dollar, that market is just too large to manipulate as easily.
My opinion, for what it's worth...Platinum is very good to own long term.

Something to look into. Maybe next time I go for some gold I will pick up some Platinum instead.

Great article man. Yeah when platinum was a bit higher before 2015 I remember it was pretty hot in the jewelry scene. It's since lost its luster and more people buying gold again.

I've thought for a while to buy a bit of pt. Silvergoldbull usually has a couple to choose from.

I don’t know much about platinum but the price may be low due to the expected electric vehicle boom coming. In which case catalytic converter use would drop substantially.

I did read that about catalytic converter usage. The price has been coming back up for the last year or so, yet is still significantly cheaper than gold.

Its certainly a neat metal. I have one small coin that I should show off.
Good info there champ.

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