Precious Metals Investing

Precious metals are elements that naturally occur in the earth. They are of great value in the market chiefly because they are rare. Some examples of these metals are gold, palladium, platinum and silver. Gold and silver are the most widely used and most known among the metals. Bullion is precious metal that is set in bulk, and it was one of the first forms of currency in the world because it was used in trading and bartering for products or services. It may not be used as currency anymore, but it has become a significant commodity in the economy. It usually comes in money bars, ingots or coins, and it is valued primarily because of its composition, purity and mass. The more valued the specific metal is, the more it will be worth on the market.

Investing in precious metals is gaining in popularity because of the benefits it can provide. Businesses and individuals have begun to accumulate different kinds of metals for security and profit. It is profitable because of the value attached to these metals that does not diminish over time. Precious metals offer security because they are a lasting entity that is accepted as a form of wealth all over the globe. The metals can be exchanged into monetary value when needed, or people can store them as savings for the future. Investors can also either buy the physical bullion or enter into an exchange-traded fund with their preferred precious metal.

Kinds and Uses of Precious Metals
• Gold
Gold is considered one of the most useful precious metals. It has characteristics and qualities that make it important in many industries. This kind of metal can resist corrosions and withstand exposure to different kinds of elements and environmental conditions. It is a conductor of both electricity and heat. Its malleability, reflectivity and ductility are superior. Gold does not tarnish, and it gives off a vibrant luster. Many things can be done with gold including hammering it into sheets or melting it into different forms.

For centuries, gold has been used as a form of wealth particularly in commerce. It has been made into a symbol of beauty, accomplishment and power and is incorporated into a number of things we utilize on a day-to-day basis. Gold has been made into different forms of ornaments, money as well as art. It has been incorporated into appliances and electronic equipment as well as medical treatments. Most of the gold mined in the world is used in jewelry manufacturing. It has become a standard of tradition to make use of gold in objects of significance. Companies, governments and individuals all invest in this precious metal.
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• Palladium
Palladium is resistant to corrosion from high temperatures and oxidation. This metal is lightweight, strong and does not tarnish easily. It helps in eliminating the harmful emissions from internal combustion engines. The biggest palladium consumer is the automotive industry. Those in the electronics industry, the medical field, water treatment services and jewelry manufacturing also make use of this precious metal.

Palladium is found in the circuit pathways of electrical devices. It is preferred over gold because palladium is more effective in small quantities. The metal also has the qualities of gold, platinum and silver that are important in making jewelry. It is used as an alternative to make ornaments and accessories because it is more affordable than the other precious metals. Palladium is considered to have a higher value than silver. Its strength equals that of platinum, but it is lighter. This metal is being used in medical research to fight certain types of cancer. It is also being studied to see if it can be used in removing specific toxins from groundwater. There are people who invest in this metal because of its rarity and the potential they see in it.

• Platinum
Platinum is considered a strategic metal in many industries. The metal has hard, durable and reflective characteristics. It is used heavily in the automotive industry, medical field, jewelry making and electronic production.

The automotive industry is one of the greatest platinum consumers. Platinum is active as the electrode material found in spark plugs as well as in automobiles’ catalytic converters. The metal is being developed to reduce possible harmful emissions. It is incorporated into electrical contacts and wires that can withstand high-voltage environments. Platinum is also used as an alternative to gold and silver in making jewelry. It is superior to silver in the sense that it resists discoloration and oxidation. People with sensitive skin will find the metal helpful because it is hypoallergenic. Platinum is not as popular as gold and silver in the market investing, but some countries have made currencies with it.

• Silver
Silver has highly durable, versatile and malleable properties, and it can be turned into many different things. It has non-corrosive, heat tolerating and electricity conducting qualities that have made it useful in a number of industries. This kind of metal also has antibiotic, anti-bacterial and anti-microbial characteristics. All these qualities have made it a significant commodity.

Silver has been incorporated in the manufacturing of batteries and a number of electronics such as circuit boards in computers, televisions and cellular phones. One of the most popular uses of silver is in cutlery. Many homes or fine dining restaurants use pure silver utensils particularly during special occasions. Silver is found in medical treatments. Bandages have silver linings that prevent infection. This kind of precious metal has also been commonly used as jewelry. It has been fashioned into a variety of accessories sold almost everywhere. Silver has a slight advantage over gold in the sense that it is more affordable. People have used silver as money for thousands of years and continue to do so.

Investment Techniques
There are a number of techniques used to invest in precious metals.
• Owning actual bullion is one of the basic investment techniques because it means having possession of a physical investment of value. Investors can buy bullion in the form of gold bars. These bars come in different sizes, and cost is based on the day’s price for the precious metal. A premium is added for marketing and manufacturing. Smaller bars are usually greater in value because of the amount of time, money and effort involved in producing them. Investors have to figure out where they want to store their bullion.

• Rather than buying physical bullion, people can invest in precious metals through exchange-traded funds. These shares are available in gold, palladium, platinum and silver varieties, and they can be traded on any major stock market daily. Investors do not hold the bullion physically. Instead, the precious metals are stored in places of the investor’s choice anywhere in the world. People who apply for this are able to participate in the market for precious metals and they can buy or sell through an online brokerage account.

• Aside from investing in precious metals via exchange-traded funds in the stock market, people can go into investment and unit trusts. This means that people will be investing in the actual companies that produce the precious metal. Investments are safe if mining companies are stable.

• People can invest in these commodities with jewelry. Precious metals used in making jewelry will usually retain their value over time. It will be best for investors to buy jewelry from mine-to-market companies. The market gets their jewelry directly from the source. This will be considerably more affordable because there are no middlemen involved.

Trends and Future Outlook
There are several factors that will affect the trends and future outlook for precious metals. Some of these factors are supply, demand and current global events. Many people have turned to buying gold and silver as a sort of refuge because of what they see is happening in the economy. Investments in silver will depend on what is needed in the industries that use it. This demand has risen because of continuing technological developments. At present, the need for silver is great in the areas of photography, jewelry and industrial use. Gold will sell more because it is of greater value. The demand for gold has risen roughly 15 percent in recent years and is still projected to continue rising. The consumption of platinum will depend primarily on the automotive industry’s needs. Palladium is considered an underdog among the precious metals because it has the same qualities as the others but is more affordable. Investments in this metal will depend on demand from the automotive and electronic industry, dental services as well as jewelers.


Precious Metals Investing
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