When we think about investing in precious metals, how often do we look beyond gold and silver? Not very, one would say. Platinum, say experts, can be a good portfolio diversifier.
MONEY TODAY speaks to market experts to understand the investment opportunities in platinum.
In India, the metal trades on the National Spot Exchange, owned by the Financial Technologies group. Platinum is primarily an industrial metal. The automobile sector is the biggest consumer (55 per cent), followed by petrochemical (25 per cent), jewellery (15 per cent) and electronic and dental (5 per cent).
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Since the beginning of the year till 11 June 2012, platinum prices underperformed that of gold and silver. However, due to supply fears in South Africa, a major producer, the metal gave 7 per cent return on a year-to-date basis till 11 June 2012, according to data on the National Commodity and Derivatives Exchange.
That day, e-platinum was trading at Rs 2,816 per gram on the National Spot Exchange. Between 2 January 2012 and 11 June 2012, gold rose 9 per cent to Rs 29,582 per 10 gram while silver was up 8.9 per cent to Rs 54,520 per kg on the MCX.
Hitesh Jain, analyst, commodity, metals and currency, IIFL, says, "Supply risk in South Africa has protected platinum. The six-week strike by workers at Impala Platinum Holdings' Rustenberg mine in South Africa resulted in 120,000 ounces (3.73 tonnes) of lost output." The strike ended on 5 March.