Silver, platinum and palladium are precious metal commodities that you can add to your portfolio, and each has its own advantages. In addition to owning physical metals, investors can access them through the derivatives market, metal ETFs and mutual funds and mining company stocks. The truth is that no one can tell you what precious metal you should buy, not even us. As with any other asset class, a precious metals portfolio is better insured when it is diversified.
For beginners, silver or gold may be the best place to start. Once you have at least a portion of each one in your portfolio, many investors begin to integrate lesser-known metals such as platinum, palladium or copper. By diversifying with precious metals, you can make your asset portfolio less risky. If you want to start investing in precious metals, silver is another solid buy.
Like gold, silver can be an effective hedge against inflation. It is also considered a “safe haven asset”, which investors turn to in times of economic uncertainty. The oldest method of investing in gold and silver is simply to buy some physical coins or ingots. Personally, I believe that investing 5% of a portfolio in precious metals is appropriate, and maybe up to 10% in some cases.
Precious metals, which are experiencing increasing demand in industrial sectors, can also offer investors attractive medium- and long-term profits. From investing in stocks and mutual funds to buying an exchange-traded fund and physically buying precious metal coins, there are many ways to participate in this sector. Silver is used in small quantities in almost all electronic devices that exist and in many other industrial applications, such as glass and solar panels, and in practice it is more of a functional metal than gold. In short, precious metals serve as a hedge against market volatility, political instability, currency weakness, and economic collapse.
Since platinum is an essential precious metal for the automotive industry, many investors are taking advantage of today's low prices. The value of a cartridge is determined solely by its weight and purity in the precious metal from which it is made. For beginning investors in precious metals, one of the most difficult decisions is deciding which metal to invest in. Investing in gold and silver is useful because precious metals are a separate asset class from stocks and bonds, are not partially correlated and have their own unique risks and opportunities.
While precious metals do not produce cash flows and cost money to manage, miners do produce cash flows and often pay dividends. But what is the best precious metal to invest in? Different investors have different needs, and it's important to know the factors that affect the supply, demand and prices of each precious metal before making a financial decision. And in my opinion, having a small allowance to precious metals such as gold and silver is a useful part of diversification, since they are partly uncorrelated with stocks and bonds and have different and unique risks and opportunities. Although platinum is a precious metal used in the jewelry industry, its price is mainly linked to the automotive sector.
If you don't want to worry about organizing the storage of physical precious metals, you may be interested in certificates. The widespread use of silver for industrial purposes, even in the rapidly growing solar energy sector, also contributes to the price of the metal. Since an ounce of gold, platinum or palladium is worth many times more than an ounce of silver, the storage space required for any sum of value in silver will be much greater than that required for other precious metals. .