Platinum Metal Bar Stock
The cost of platinum, like all investments, is subject to the economic laws of supply and demand. More precious than gold or silver, the silvery-white metal is prized for its chemical properties. Investors need to determine for themselves the wisdom of adding platinum metal bar stock to their portfolios as there are no guarantees in the stock market. Savvy investors make investment decisions based on personal strategies and goals. Those interested in pursuing this rare metal as an investment vehicle should do as much research as possible before taking that initial step.
Before discussing the five-year history of the cost of platinum, let's look at the metal's history and applications. Before French king Louis XVI declared this lustrous rarity a royal metal, such ancient cultures as the Egyptians and the Incas treasured their finds. Spanish conquistadors brought what they called "platina," the Spanish word for "little silver" to Europe from the New World along with shiploads of other riches. In the 18th century, refining techniques were developed that purified the final product, and in the 19th century, the fashionable wore platinum jewelry. Both the priceless Hope Diamond and the Star of Africa are mounted in "platina" settings. During World War II, the United States government banned its use for non-military purposes and still considers this strategic metal to be a military resource.
Three major regions are mined for platinum. These are the Bushveld Igneous Complex of South Africa, an area rich in mineral deposits; Russia's Ural Mountains and areas of Siberia; and the North America continent's areas of Montana and Ontario. Thanks to global geological surveys, explorations of other areas are being undertaken. These include regions of Australia, South America's Chile, Indonesia, Zambia, and Zimbabwe. The primary source is the South African mines. Their 2006 production statistics show that 214 tons of the rare metal were produced that year in comparison with 2,467 tons of gold and 16,127 tons of silver. Only ten percent of the production went to making coins for investment purposes. Forty percent was used for jewelry and about half, or about 100 tons, were used in catalytic converters. One reason the cost of platinum is being driven higher is because its rarity coincides with diesel trucks needing to meet increased international emission standards.
Demand is high in other areas, too. The malleability property means "platina" can be formed into tubing, rods, bars, and alloy wires. Because of the effective catalyst properties for chemical reactions and because allergic reactions to the metal are rare, industries purchase the metal in these various forms for all kinds of diverse applications. Besides being used in auto components and jewelry, platinum is used in chemical processing, dentistry, electronics, fuel cells, glass and glass fiber applications, petroleum refining, and in the production of biomedical component parts. Other desirable properties are also present. The silvery metal doesn't tarnish or corrode, is not affected by water, and is a good conductor for electrical components. Combining it with cobalt adds magnetic properties.
The rare metal is heavier and harder than gold. For example, one expert states that a block of platinum the size of an ordinary sixteen-ounce beverage can would weigh about fifty pounds and be valued at over a million dollars. While gold is soft and often combined with other metals to form an alloy before being used for practical purposes, platinum can be used in a pure state. But the expense of labor and the refining process is another factor in the high cost of platinum. Even in South Africa, sixteen tons of mined ore only yields one ounce of the "little silver." Manufacturers purchase the formed bars or rods.
For financial matters, these wise words from the Scriptures are worth noting: "The wisdom of the prudent is to understand his way but the folly of fools is deceit" (Proverbs 14:8). Keeping that in mind, investors with a rare metals component in their portfolio can choose to purchase minted coins or ingots, mining company stock, or platinum metal bar stock, The appeal of owning coins is that the investor or collector has a tangible asset in her possession. Experts suggest that those choosing this route buy only coins that are documented as having .999 purity. The stock investor can research publicly traded mining companies to find suitable options. The two largest mining companies in North America primarily mine for the metal palladium, but they also mine a small percentage of platinum. They are publicly traded and the interested investor can find more information about them on countless investment websites. Whether or not buying stock in these individual companies is a wise decision is up to each investor to decide. These wise words from the Scriptures are worth noting. "The wisdom of the prudent is to understand his way but the folly of fools is deceit" (Proverbs 14:8).
Investing by purchasing platinum metal bar stock is an additional option. Someone who purchased shares five years ago certainly has nothing to complain about. One internet chart shows that the metal sold for approximately $700 an ounce in February 2003. The going rate in February 2008 was approximately $2200 an ounce. Again, the tremendous increase in price is due to the competing forces of supply and demand. The supply remains scarce and the cost of refinement is expensive, but the demand for increased applications, especially in burgeoning technological and biomedical fields, is ravenous. Will the cost of platinum continue to rise? Is investing in platinum metal bar stock a good idea? The metals market has been a volatile investment choice in the past. Whether or not this market remains a worthwhile investment vehicle is a question each investor must answer for himself.
Before discussing the five-year history of the cost of platinum, let's look at the metal's history and applications. Before French king Louis XVI declared this lustrous rarity a royal metal, such ancient cultures as the Egyptians and the Incas treasured their finds. Spanish conquistadors brought what they called "platina," the Spanish word for "little silver" to Europe from the New World along with shiploads of other riches. In the 18th century, refining techniques were developed that purified the final product, and in the 19th century, the fashionable wore platinum jewelry. Both the priceless Hope Diamond and the Star of Africa are mounted in "platina" settings. During World War II, the United States government banned its use for non-military purposes and still considers this strategic metal to be a military resource.
Three major regions are mined for platinum. These are the Bushveld Igneous Complex of South Africa, an area rich in mineral deposits; Russia's Ural Mountains and areas of Siberia; and the North America continent's areas of Montana and Ontario. Thanks to global geological surveys, explorations of other areas are being undertaken. These include regions of Australia, South America's Chile, Indonesia, Zambia, and Zimbabwe. The primary source is the South African mines. Their 2006 production statistics show that 214 tons of the rare metal were produced that year in comparison with 2,467 tons of gold and 16,127 tons of silver. Only ten percent of the production went to making coins for investment purposes. Forty percent was used for jewelry and about half, or about 100 tons, were used in catalytic converters. One reason the cost of platinum is being driven higher is because its rarity coincides with diesel trucks needing to meet increased international emission standards.
Demand is high in other areas, too. The malleability property means "platina" can be formed into tubing, rods, bars, and alloy wires. Because of the effective catalyst properties for chemical reactions and because allergic reactions to the metal are rare, industries purchase the metal in these various forms for all kinds of diverse applications. Besides being used in auto components and jewelry, platinum is used in chemical processing, dentistry, electronics, fuel cells, glass and glass fiber applications, petroleum refining, and in the production of biomedical component parts. Other desirable properties are also present. The silvery metal doesn't tarnish or corrode, is not affected by water, and is a good conductor for electrical components. Combining it with cobalt adds magnetic properties.
The rare metal is heavier and harder than gold. For example, one expert states that a block of platinum the size of an ordinary sixteen-ounce beverage can would weigh about fifty pounds and be valued at over a million dollars. While gold is soft and often combined with other metals to form an alloy before being used for practical purposes, platinum can be used in a pure state. But the expense of labor and the refining process is another factor in the high cost of platinum. Even in South Africa, sixteen tons of mined ore only yields one ounce of the "little silver." Manufacturers purchase the formed bars or rods.
For financial matters, these wise words from the Scriptures are worth noting: "The wisdom of the prudent is to understand his way but the folly of fools is deceit" (Proverbs 14:8). Keeping that in mind, investors with a rare metals component in their portfolio can choose to purchase minted coins or ingots, mining company stock, or platinum metal bar stock, The appeal of owning coins is that the investor or collector has a tangible asset in her possession. Experts suggest that those choosing this route buy only coins that are documented as having .999 purity. The stock investor can research publicly traded mining companies to find suitable options. The two largest mining companies in North America primarily mine for the metal palladium, but they also mine a small percentage of platinum. They are publicly traded and the interested investor can find more information about them on countless investment websites. Whether or not buying stock in these individual companies is a wise decision is up to each investor to decide. These wise words from the Scriptures are worth noting. "The wisdom of the prudent is to understand his way but the folly of fools is deceit" (Proverbs 14:8).
Investing by purchasing platinum metal bar stock is an additional option. Someone who purchased shares five years ago certainly has nothing to complain about. One internet chart shows that the metal sold for approximately $700 an ounce in February 2003. The going rate in February 2008 was approximately $2200 an ounce. Again, the tremendous increase in price is due to the competing forces of supply and demand. The supply remains scarce and the cost of refinement is expensive, but the demand for increased applications, especially in burgeoning technological and biomedical fields, is ravenous. Will the cost of platinum continue to rise? Is investing in platinum metal bar stock a good idea? The metals market has been a volatile investment choice in the past. Whether or not this market remains a worthwhile investment vehicle is a question each investor must answer for himself.
Platinum Metal Bar Stock
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