Investing In Precious Metals Can Add Value To Your Portfolio

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Will having gold, silver, and platinum commodities in your portfolio be considered a good investment? Most beginning investors focus on stocks, mutual funds, and exchange-traded funds (ETFs) because its easier to understand. Commodities can yield real profits, but it does have an extra learning curve which discourages many beginning investors to add to their portfolios.

Gold and silver have been considered the precious metals of choice for commodities investment and it is possible to invest online. Platinum, on the other hand, is a viable investment in physical form due to its scarcity. Simplifying definition of what is a commodity and each precious metals characteristics will yield a better understanding of its values.

What Is A Commodity?

Commodities are economic goods normally traded in bulk in the commodity exchange. They consist of metals, fuels, and agricultural products that are bought and traded freely as an article of commerce. The quality of a particular commodity may slightly differ but must meet the basis grade standard.

What Is Gold?

Gold is the only yellow color precious metal. The chemical symbol is Au with the chemical element of atomic number 79. Gold is known for its durability and it doesn’t corrode or rust.

It’s soft and malleable, used in jewelry, decoration, and as an assurance for the value of currencies in written form. Gold’s malleability is ideal for bases of jewelry. Also, it’s know to conduct electricity and heat used in industries, such as dentistry and electronics.

Mainly, gold is used as a guarantee to value currencies. Investing in gold online can introduce you to commodities investment if you are a beginner because it’s not as volatile as other metals. To diversify your portfolio, online gold Forex trading is profitable without owning the asset physically.

The gold bullion’s performance is often compared to stocks as a different investment vehicle. Gold is often used in an investment strategy as a leverage, if the trend reverses, to increase gains and risk of capital loss.

So, having gold in your portfolio will yield profit long-term. When turmoil in the capital markets arise, gold performs relatively well as investors seek out temporary refuge investments.

What Is Silver?

Silver is a white, soft, and lustrous transition precious metal. The chemical symbol is Ag with the chemical element of atomic number 47. Silver has the highest electrical, thermal, and reflective conductivity of any metal.

Silver metals are soft, ductile and not as malleable as gold. However, it is malleable enough to be made as a base for jewelry, similar to gold. Pure silver is often too soft in material, it is often mixed with copper to be transformed into cutlery, which is ideal as silverware due to its anti-bacterial properties.

It is a wise investment to buy silver bars now while the silver market is on the upswing. Investing in silver bars in a bull market is a wiser investment choice because it outperforms gold. Since mining for silver is insufficient, this precious metal demand will only increase its value long-term.

What Is Platinum?

Platinum is the Spanish term platino, meaning “little silver.” The chemical symbol is Pt with the chemical element of atomic number 78. It is ductile, dense, malleable, and highly unreactive metal.

When it comes to the engagement ring of choice, platinum is set to remain the most popular above gold and silver for 2019. Platinum is popular due to its aesthetically pleasing color, hypoallergenic, and tarnish resistant qualities. Also, its popularity rose when Prince Harry chose a platinum wedding band.

Many luxury watchmakers, such as Rolex, Vacheron Constantin, Patek Philippe, and Breitling use platinum when producing their limited edition watches.

Of the three precious metals, platinum is fairly new in the investment circle and 15 – 20 times scarcer than gold.

Platinum bars and American Platinum Eagle coins, sold since 1997, are the traditional ways to invest in platinum. Other ways to invest in Platinum are owning traded options (only available in the US market), and owning shares in mining companies with substantial platinum assets or exposure.

According to a recent Forbes article, #1 Investing Tip for 2019, investors who will thrive in 2019 will benefit in having 25% exposure to both gold and silver commodities in their portfolio. Investing in platinum jewelry will not only enhance your portfolio but your fashion sense as well.

Published by Kidal Delonix (941 Posts)

Kidal Delonix is a contributor to Mr. Hoffman's blog. The views and opinions are entirely his/her own and may not reflect Mr Hoffman's views.

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