Has anyone found an effective way to invest in the platinum spot price? Platinum coins and are not easy to buy or sell at a reasonable value. Dealers offer a buy/sell spread of 10% or more, and they seldom come up on SS. Platinum bars have similar problems with premium and liquidity. Otherwise shares in ETFS Physical Platinum which is a lot more liquid, but charges 0.49% in annual fees and has counter-party risk. Any other ideas?
Pt is very easy to invest in you simply buy coins (Koalas (if you find them) platypus or bars PAMP) and yes the premium is a bit more than gold. Therefore it is hard to trade but easy to invest in. If you believe as I do, that Pt price will once again exceed gold then the premium is less important. Reasonable value ? who knows. One more strike in SA and $2000 may be reasonable? Look around at the dealers and talk to them, prices do vary a bit. Its best to buy when no one is interested like a few months ago. I see some of the dealers are now out of coins (platypus). I don't believe Pt should be your main core PM investment but maybe 5-10% of PM holdings is a good level? Just my opinion....(not worth much I know)
Yes, easy to buy, but being down 10% as soon as you walk out the door is not a great investment. I forgot to mention allocated/unallocated storage as another option. E.g ABC Bullion offer storage ranging from free to 0.95% per annum. That still has counter-party risk, but the good thing is that (all going well) it's quick to invest or redeem at minimal loss, and you can also choose to receive physical at any time if you want.
Coin buyers expect a premium. It's the nature of the beast. So you aren't really down because the premium for coins is part of the fair market value. If spot didn't change from the time you bought to the time you sold, you'd likely be able to recoup what you paid as long as you're selling to another investor and not a dealer. Just my opinion.
That's fine if you can find another "sucker" to pay the premium, but you can only count on your investment being worth what someone is openly offering, and currently that means around spot-5%. Anything you get above that is a bonus. Compare that to gold where you can walk into a dealer and sell for 1-2% below spot, or put it up for spot here (or even spot + a couple of percent) where it will get buzzed instantly.
That is simple then for you buy gold and forget about Pt. Others may think it worth while and that down the line Pt may outperform gold.
Spot platinum as I write this is $1,553.50 USD. APMEX will BUY 1 oz. platinum Platypus at $1,583.50, Maples at $1573.80, Eagles over $1,600. The dealers I know here in the U.S. can't keep platinum in stock.
1,583.50USD dealer bid price for platinum platypus is good. Note that that is for a minimum trade of 10,000USD. Still, the spread is only 3.2% (+ postage?) there. Dealer bid price in Australia is 1,497AUD= 1,546USD.
Just out of interest who on this SS site would sell their Pt or Au or Ag back to a dealer ?????? I would love to see Ainslie buy a 2oz silver S2 Mouse for $500
How about trades? As a broke kiwi platinum is a bit out of my league but this is something I would like in my stack. If the goldlatinum is 1:1.1 and platinum carries a 10% premium would it be fair to trade ounce for ounce? Or even if you have to buy the stuff price should be about the same as gold? Believing that any price below gold price is underpriced one could hold with the intention to swap into gold at a later date when....... Platinum > gold then you win Platinum = gold then you lost nothing Platinum < gold then you lose All this talk of spot and premium and liquidity is irrelevant in my eyes. The real question is what's the ratio to gold what direction do you think that's going and do you see people with gold wanting to trade in future?
I said the dealer's spread was about 10%, not a 10% premium on spot price. But the point is that you hope you can sell it for the same premium you paid for it. The only platinum I've seen come up for sale here in the past couple of months was from Chillidog who pulled it because "No body was interested": http://forums.silverstackers.com/message-418902.html#p418902, referring to his attempt to sell at http://forums.silverstackers.com/topic-31780-1oz-platinum-platypus-2011-sale-pulled.html
This is where we differ. Are you interested in spread or in upside potential? I dont care about spread because I dont trade. I started seriously buying Pt in 2008 when it crashed to $790 or something. Do I care that the spread is 10% ? As I said trading Pt maybe a problem, investing is no problem. Like gold I see a slowly rising bull market over time. As the Pt market is very small and refining is very long (8 months) capacity is very limited. A sudden shortage and there is no capacity at all. The mining crisis in SA will only physically impact the supply mid next year. Unless you understand the market that is not obvious. The reason people have problems selling is that: 1. Most of the SS are not in tune with the fundamentals of the platinum metal group 2. Seen as a non- monetary metal ??? watch when shortages occur we will be educated very fast.
Chillidog had the sales thread up for 1 day before pulling it because spot price was rising and he didn't want to keep raising his asking price. I don't think that one sale attempt is valid for determine platinum buying interest on the forum.
I'm with you. A while back I wrote a Seeking Alpha article looking at the historical ratios of silver, gold, platinum. This is what I came up with regarding goldlatinum. "From the charts I readily found tracking the trends from 1972 through 2011, the average gold to platinum ratio across those 39 years was approximately 1.36 oz. gold to 1 oz. platinum. Strong support is at an even ratio of 1:1. Platinum generally has bottomed when approximately 0.75 oz. gold buys 1 oz. of platinum. An indicator of a platinum bubble forming is when it reaches 2 times the price of gold or more. An indicator of a gold bubble forming is when it reaches 1.5 times the price of platinum or more." Right now, 0.91 oz. gold buys 1 oz. of platinum. All the premium talk is a bit silly. Last time I checked, I have to a premium on all investment grade precious metals, whether it's generic bars or government coins.
Platinum and Palladium Report Just Out From Johnson Matthey (sorry about the length) --------------------------------------------------------------- Platinum 2012 Interim Review 13th November 2012 interim 2012 cover 250 x 350 PLATINUM MARKET FORECAST TO BE IN DEFICIT IN 2012 SOUTH AFRICAN PLATINUM SUPPLY TO FALL TO LOWEST LEVEL SINCE 2001 A substantial reduction in supplies, as well as lower volumes of autocatalyst recycling, will move the platinum market from surplus to deficit in 2012, according to Johnson Matthey in "Platinum 2012 Interim Review", released today. Severe disruption to pgm mining is expected to reduce sales from South Africa and result in a 10% drop in worldwide platinum supplies to 5.84 million ounces. Gross demand is predicted to remain firm, at 8.07 million ounces, while a decline in recycling will help decidedly shift the market into a deficit of 400,000 oz. Platinum supplies from South Africa are forecast to fall by 12% year-on-year to 4.25 million ounces, an eleven-year low. South African platinum production losses due to strikes and safety stoppages in the first three quarters of 2012 are estimated to be at least 300,000 oz. The closure of marginal operations by some junior producers and below-plan performance at other mines will also account for some reduction in supply this year. Output and sales of platinum from other producing regions will remain broadly flat. Gross platinum demand in autocatalysts is predicted to soften by 1% to 3.07 million ounces. Falling vehicle production in Europe, together with a slight decline in the market share of diesel cars in the region, will be largely offset by higher purchasing of platinum by Japanese manufacturers as output improves following last year's natural disasters. Greater demand is also expected from the light duty diesel sector in India, where sales have grown strongly in 2012, as well as more platinum used in heavy duty diesel emissions after treatment worldwide. Demand for platinum in the jewellery sector is expected to reach a three-year high of 2.73 million ounces. Gross demand from the trade in China is forecast to reach 1.92 million ounces driven by lower average platinum prices and an increase in the manufacturing of platinum jewellery to stock new retail stores being opened by Hong Kong brands in mainland China. Consumer demand for platinum jewellery in India has continued to grow, prompting an expansion of platinum jewellery manufacturing and retailing. Industrial demand for platinum is forecast to subside by 13% to 1.79 million ounces in 2012. In the glass manufacturing sector, new purchasing will be offset by the use of platinum scrapped from old facilities and the drawing down of inventory bought last year. Electrical demand is also expected to soften but purchasing of platinum for non-road emissions control applications will rise. Physical investment demand for platinum is expected to remain positive, at 490,000 oz. Investment in physically-backed exchange traded funds (ETFs) has largely followed the price during 2012, with net investment generally during periods of rising price. Net acquisitions by investors in the Japanese large bar market and in the coin sector will also supplement demand. Platinum recycling is forecast to fall by 11% to 1.83 million ounces in 2012. Platinum recovery from spent end-of-life vehicle catalysts is expected to soften as collectors have been holding on to spent converters in anticipation of improved prices. Platinum jewellery recycling will also weaken due to lower returns of old consumer pieces in Japan. In 2013, gross platinum demand is expected to see modest growth, with steady autocatalyst demand and a recovery in industrial purchasing. However, as a result of ongoing disruption and possible restructuring of the industry, it is difficult to expect an increase in supplies from South Africa of any great magnitude from the 4.25 million ounces forecast this year. Recycling could be a key factor in the platinum market balance in 2013, especially if prices see a material and sustained improvement, driving higher throughput of catalyst substrates to refineries. LARGE PALLADIUM MARKET DEFICIT FORECAST FOR 2012 AUTOCATALYST DEMAND FOR PALLADIUM TO REACH RECORD LEVEL The balance of the palladium market is forecast to swing by over 2 million ounces this year from surplus to deficit, due to lower supplies, higher gross demand and less recycling. Supplies will contract mainly because of lower sales of Russian state stocks, while recycling will be constrained by subdued pgm prices. Gross palladium demand is predicted to rise to 9.73 million ounces, driven by a return to positive net physical investment and higher autocatalyst purchasing, moving the palladium market into a deficit of 915,000 oz. Supplies of palladium are predicted to decline to a nine-year low of 6.57 million ounces. Palladium supplies from South Africa are forecast to fall by 6% this year, to 2.40 million ounces, in line with lower underlying platinum output. Newly refined palladium supplies from Russia are expected to decrease due to a change in the ore mix and falling average grades. Sales of Russian state stocks are forecast to drop by over half a million ounces compared with last year, to 250,000 oz. Purchasing of palladium by the autocatalyst sector is expected to rise by 7% to a new high of 6.48 million ounces. Demand for palladium is forecast to benefit from growth in global vehicle production, with the strongest performance in the principally gasoline markets of Japan and the USA, as well as continuing substitution of platinum in both light and heavy duty diesel aftertreatment formulations. Industrial demand for palladium is forecast to soften by 3% to 2.41 million ounces. In electrical applications, a long-term trend towards using cheaper base metal alternatives to palladium in all but niche and high-end applications continues to drive demand lower. However, a wave of chemical plant construction in China will stimulate purchasing of palladium for new catalyst charges. This year is set to mark the return to positive physical palladium investment demand, in contrast with the net liquidation seen in 2011. For the year as a whole, a change in investor sentiment towards palladium ETFs is expected to result in 385,000 oz of net new physical investment demand, a swing of 950,000 oz compared with last year. Gross demand for palladium in jewellery is predicted to dampen by 11% to 450,000 oz. Purchasing of palladium by the Chinese jewellery sector is expected to decline once again as the metal continues to suffer from a lack of positioning and effective marketing, as well as competition from low-fineness gold alloys. Supplies of palladium are expected to fall in 2013 as a result of lower output from Russia and the diminishing likelihood of a significant increase in output from South Africa. Another year of solid autocatalyst and industrial demand is forecast, together with higher returns of palladium from end-of-life vehicle recycling.
