If you are thinking about investing in precious metals, consider adding platinum to your list of metals to consider. Though platinum is a less traditional choice than gold or silver, this very rare metal offers a variety of benefits to diversify your portfolio.
Various industries use platinum today, and with new advances in sectors like medicine and automobile manufacturing, demand for platinum will likely continue to remain high. Investors can choose from a range of bars and coins when buying platinum. Learn more about the benefits of investing in platinum and the properties to look for when buying this metal.
Why Buy Platinum?
Platinum is incredibly malleable and versatile, making it incredibly useful in many applications. Properties of platinum that make it useful in a variety of sectors include:
- Resistance to corrosion and tarnishing
- Malleable, soft, and easy to shape
- Ductile and easily stretched into wire
- Unreactive and doesn’t oxidize
- Not affected by common acids
- Bonds easily with other elements
Platinum commands a high price for a variety of reasons:
- It is located deeper in the earth than gold. It also requires a more difficult purification process. As a result, platinum is harder to produce than gold.
- It boasts a wide variety of uses in different products, including:
- Catalytic converters
- Electrical contacts
- LCD screens
- Spark plugs
- It is extremely rare. Platinum exists in Earth’s crust in only around five parts per billion by weight.
The factors that make platinum useful in industrial applications also make it a good choice as a precious metal investment:
- As with silver, platinum will likely have a stable future as it is used in a variety of ways throughout many industries.
- Because platinum is very rare, it tends to be easy to find buyers for platinum coins or bars.
- Its rarity also means its value will likely continue to increase long term.
- Because platinum has a high value-to-density ratio, you do not need a lot of platinum to amass wealth, making storage, transportation and safekeeping easier than with other metals.
You can buy platinum in two main ways: platinum bars or platinum coins. Both bars and coins offer different investment benefits, so it’s helpful to learn more about these forms to decide which may be right for you.
Platinum bars contain 0.9995 pure platinum. They also bear stamps that confirm their purity. If you want to start building your assets quickly, platinum bars may be a good choice.
Unlike other precious metal bullion bars, platinum bars are typically only available in the following sizes:
- 1-gram bars
- 5-gram bars
- 1-ounce bars
- 10-ounce bars
As manufacturing costs are about the same for small and large bars, you pay a lower premium if you purchase a larger bar compared to a smaller one. For example, it is less expensive to buy a single 10-ounce bar than to buy 10 1-ounce platinum bars.
Producers of platinum bars for investment include:
- Credit Suisse
- PAMP Suisse
- Valcambi Suisse
- Johnson Matthey
- Baird & Co.
- Engelhard Corporation
Credit Suisse and PAMP Suisse, two of the leading precious-metal refiners in the world, offer most of the platinum bars available on the investment market. Their popular options include the 1-ounce Credit Suisse Platinum bar and 1-gram PAMP Suisse Fortuna Platinum bar, respectively.
Platinum coins are issued by governments and have lower face values than the platinum content value. The mandated purity of these coins is 0.9995 pure platinum. The most popular size for platinum coins is 1 troy ounce. Some platinum coins offer additional value as collectibles, so you may enjoy the process of building a collection that could potentially increase in value.
Popular examples of platinum coins include:
- American Platinum Eagle: Authorized by the United States Congress and backed for weight and content by the United States Mint, the American Platinum Eagle debuted in 1997. The 1-ounce coins have a $100 USD face value. The United States Mint also strikes and releases a Proof American Platinum Eagle annually in addition to the bullion platinum coin.
- Canadian Platinum Maple Leaf: The Platinum Maple Leaf coin was introduced with the Canadian Silver Maple Leaf coin in 1988. The coins were offered in 1-ounce and fractional weights until 2001. When the platinum coin returned in 2009, only 1-ounce coins were made available.
- Australian Platinum Kangaroo: The Platinum Kangaroo builds on the success of the Perth Mint’s Kangaroo series. It was first released in 2018 and has a $100 AUD face value backed by Australia’s federal government.
- Australian Platinum Platypus: This coin is an annual release from the Perth Mint. It has a $100 AUD face value backed by Australia’s federal government.
- Austrian Platinum Philharmonic: In 2016, the Austrian Mint released a platinum version of its popular Philharmonic coin, which it previously offered in only gold and silver.
- British Platinum Queen Beast: The coin series began in 2016 with gold and silver coins, expanding in 2017 to offer a 1-ounce platinum coin that features the Lion of England images.
- Isle of Man Platinum Noble: These 1-ounce legal tender coins were produced by the Pobjoy Mint (located in Surry, England) from 1983 to 1989.
- Somalian Platinum Elephant: The Somalian Elephant Series, produced by the Bavarian State Mint, added a platinum coin to its fast-growing coin program in 2016.
Platinum’s scarcity coupled with its range of uses in multiple industries means demand for this metal will likely remain high. Additionally, platinum offers ease of storage, transportation and security compared to other metals with a lower value-to-density ratio. Though platinum might not be as traditional as gold or silver in terms of precious metal investment, it offers an interesting option to diversify a portfolio, with both bars and coins available for purchase.