As one of the most valuable metals readily available, platinum bullion makes an ideal collectible as well as being a stable investment. Bullion has two huge advantages when considered as an investment: the first is that you can maintain physical control of it; the second is that its not subject to inflation because the only way to get more is to physically dig it out of the ground.
What Forms does Platinum Bullion Come In?
Platinum bullion comes in two main forms:
- Coins: One of the most common forms for platinum bullion is that of coins such as the platinum American Eagle or Canadian Maple Leaf. While these coins are legal tender, their metal value is usually much higher than the denomination.
- Bar or Round: Bars and rounds are as the names suggest simply small pieces of precious metal at a designated purity.
What Factors Affect Platinum as a Bullion Metal?
When investing in platinum bullion there are a number of factors which affect the value that you have to consider:
- Rarity: Platinum is an extremely rare metal, with most of it coming from mines in South Africa and Russia. This scarcity is one of the main factors that drives its value.
- Industrial Uses: Platinum has a number of industrial uses, particularly in the automobile industry where its employed in catalytic converters. Automotive demand is one of the biggest drivers of platinum prices.
- Market Stability: Platinum does well in stable markets, often commanding a significant premium over gold.
Bullion Coins vs. Numismatic Coins
When it comes to buying coins for investment purposes, you have two main options: Bullion coins and numismatic coins. In both cases, these coins offer an investment value that is separate from the denomination. The big advantage of buying platinum bullion is that the value ties to a consistent external factor: the metal content. Numismatic coin values depend solely on rarity and demand and therefore tend to be much more variable than bullion coins. Bullion coins also often trade on smaller margins than numismatics so you tend to lose less value if you have to liquidate in a hurry.