Platinum - how to invest in platinum? [Guide]

In contrast to silver i gold, platinum has no historical uses dating back to distant antiquity. It was not discovered until the XNUMXth century and initially did not enjoy a good reputation. Its name comes from the diminutive of the Spanish word "plata" (silver), meaning "platina" (silverware). The contemptuous diminutive name for this precious metal was associated with an initial lack of use value.

Chart - Platinum

The use of platinum

With time, platinum began to be made of crucibles and bowls for chemical laboratories and apparatus for the chemical industry, due to its high melting point and exceptional resistance to chemical agents. Currently, it is used in many industries.

Automotive industry

Almost half of the platinum mined every year is used by the automotive industry (2014% in 45). Therefore, platinum prices are closely related to the boom in the automotive industry.

Jewelry

Over of the platinum produced is used in the jewelery industry for the production of jewelery. In 2014, it was 74.7 tons of platinum, or 34% of the annual extraction of this metal.

Chemical industry

Platinum compounds are used as catalysts in many industrial chemical reactions and in the production of laboratory equipment.

In addition to the industries mentioned above, smaller amounts of platinum are also used in the production of electronics and medicine.

Platinum mining and deposits in the world

Platinum is an extremely rare metal. It is much less common than gold and silver. Annually, about 1700 tons of gold and only 200 tons of platinum are mined in the world. The main forms of occurrence are pure form, in the form of nuggets weighing up to 10 kg, and in nickel and copper ores.

The first platinum deposits were discovered in Colombia in the XNUMXth century. The second discovered source of platinum was the Russian Ural Mountains, which made Russia the largest producer of platinum throughout the XNUMXth century.

Currently, the largest platinum deposits are in South Africa, Russia, Zimbabwe, Canada and the United States. 80% of the world's platinum production takes place in South Africa. The table below presents the amount of platinum mined in 2019 by the 5 countries with the highest extraction of platinum.

Almost half of the platinum mined in the world is purchased by European countries. Japan and the United States are the next largest importers of platinum. Every year they buy about 10-15% of this precious metal. China is responsible for 5% of world imports.

What influences the price of platinum?

Due to the fact that South Africa is responsible for nearly 80% of global production of platinum, the economic and political situation in this country has a large impact on the fluctuations in the price of this raw material. The economic situation in the automotive industry and the demand for this metal as an investment metal are also of great importance.

The situation in South Africa

As in all emerging markets, the economic and political situation in South Africa is unpredictable and volatile. Workers 'strikes or political friction may disrupt the continuity of platinum mines' operation, and thus affect the prices of this metal. Other political aspects, such as new taxes, regulation of land trading and use, or nationalization or privatization of workplaces, may affect the price of platinum.

The boom in the car industry

Currently, more than 40% of the global platinum production is used in the automotive industry to create catalysts. The good economic situation in this sector, the overall good condition of the economy and the high demand for cars have a positive effect on platinum prices. In turn, the development of the electric car industry and the replacement of platinum in the construction of catalysts with palladium may have a negative impact on the prices of this metal.

Demand for location metals

Currently, platinum is not a very popular foundation metal. Investors definitely prefer gold and silver. However, due to the record prices of gold and silver, it is possible that investors will start looking for alternatives and become interested in this precious metal as well.

How to invest in platinum

Placement platinum

The popularity of placement metals has increased significantly recently. This pushed gold and silver prices to historic highs. Less popular precious metals such as platinum are also gaining ground in this trend. It can be purchased in the form of coins and bars at mints and from precious metal dealers on the Internet and at stationary points.

Placement platinum, like all physical precious metals, requires a safe place to be stored. In this way, invested capital can also be difficult to dispose of quickly and find a buyer. The advantage is full control over the asset, having some savings outside the banking system and having some savings in assets resistant to the negative impact of inflation.

Futures contracts

Na CME platinum futures are also listed in New York. One contract is for 50 troy ounces of platinum. The symbol for platinum futures is PL. Contracts expire every month.

The troy ounce is a measure for precious metals and is a little over 31 g, which is 3 g more than a trade ounce.

Shares of platinum mining companies

[AMS] Anglo American Platinum

The largest producer of platinum in the world, with nearly 40% share in the global production of platinum. The company produces not only platinum, but also palladium, being the second largest producer of palladium in the world. The company owns not only mines, but also smelters and refineries. The company sold less profitable mines, focusing only on the most profitable ones, therefore it boasts very low production costs compared to its competitors. Shares listed on the Johannesburg Stock Exchange, South Africa. The shares are traded on the South African Rand (currency symbol is ZAR).

[IMP] Impala Platinum

The second largest producer of platinum in the world, it manages 3 mines in South Africa and 2 mines in Zimbabwe. In addition, it conducts research projects in many other deposits of this metal (Botswana, Mozambique, Russia and Canada). The company also has refineries. In addition to platinum, the company also produces palladium and rhodium. The company has been the subject of severe criticism for its insufficient application of safety rules at work, but in recent years it has regularly improved the safety of employees at its plants. Impala Platinum is listed in Johanseburg, South Africa and its shares are traded in South African Rand, symbol ZAR.

Platinum CFDs

Another way to invest in platinum are CFDs available from every bigger one forex broker. CFDs are leveraged - with brokers from the European Union, the maximum leverage for platinum is 1:10. Below is a list of offers from selected brokers offering the best conditions for trading on platinum (CFDs).

How to buy platinum - Brokers offering platinum CFDs

Below is a list of offers from selected brokers offering the best conditions for trading on platinum (CFDs).

Broker
End	Poland	Denmark
Platinum symbol	PLATINUM	PLATINUM
Min. Deposit	PLN 0 (recommended min. PLN 2000 or USD 500, EUR)	0 PLN / 0 EUR / 0 USD
Min. Lot value	price * 150 USD	b / d
Commission	-	-
Platform	xStation	SaxoTrader Pro Saxo Trader Go
	REVIEW	REVIEW
	CREATE AN ACCOUNT	CREATE AN ACCOUNT

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. From 72% to 89% of retail investor accounts record monetary losses as a result of trading CFDs. Think about whether you understand how CFDs work and whether you can afford the high risk of losing your money.