Like gold and silver, platinum is traded 24 hours a day on global commodity markets. It tends to reach a higher price (per troy ounce) than gold during routine periods of political and market stability simply because it is much rarer. In fact, much less metal is extracted from the ground every year. In the end, precious metals have their uses as investments.
When political or economic uncertainty hits, investors often turn to alternative or tangible assets to protect their portfolios. Precious metals such as gold are just one option available to you. However, all investments come with risks. Platinum has higher volatility than other options, making it more susceptible to price drops.
Meanwhile, gold remains relatively stable, but it may not be a solid hedge against short-term inflation. Gold has long been popular as a financial asset and because of its aesthetic value. Platinum is another precious metal used in jewelry and also has industrial applications. Both can be good investment options, but there are differences in terms of long-term stability and price fluctuations.
Platinum is generally valued more than gold. This is because platinum is rarer than gold, has a higher density and is purer. Platinum rings require more platinum than gold rings, which can increase the total cost. One of the main reasons why many think platinum is more valuable than gold is that the latter, most of the time, has a lower price.
Gold and platinum prices tend to be very close, but generally speaking, gold tends to be less expensive than platinum most of the time. Combine higher prices with the perception that platinum is much rarer than gold and you'll get the impression that platinum is worth more than gold. Both platinum and gold have advantages and disadvantages, and everyone has to decide for themselves what they value most. Platinum and gold are two precious metals and non-traditional assets that investors can use for financial benefits, such as hedging against inflation.
You can go anywhere on the planet and people will recognize gold and offer something for it in return. The combination of higher gold production and the fact that gold mining takes place for much longer results in less platinum than gold in the world above ground. The COMEX gold futures contract is one of the most liquid commodity futures in the world; its daily trading volume represents about 27 million ounces of gold. While gold can increase in value the greater the carat, platinum is almost always worth more than gold.
White gold is created by mixing gold with white metals such as silver or nickel, and is coated with rhodium. The two most important gold futures exchanges are the COMEX division of the CME Group in New York and the Tokyo Commodity Exchange. Take credit cards, for example; a platinum credit card usually has a higher limit than a gold card, meaning it has a higher status. Precious metals such as platinum and gold offer attractive opportunities for investors seeking to diversify in the commodity market, and each has its own strengths, risks and market trends.
So how do you explain the price of gold and platinum? To better understand how the prices of gold and platinum are determined, it is important to analyze supply and demand.