Tuesday, August 7, 2012

I'd Rather Own Platinum than Gold

Historically an ounce of platinum has been worth more than an ounce of gold. For example, since the mid-80s the 1:1 price ratio was pretty much a hard stop. But recently (beginning during the inflation scare post-recession), an ounce of platinum has sold for less than silver. The ratio is currently 0.9.

The best part of platinum right now is that it is selling for below marginal cost! And platinum miners are starting to close down mines.


effmanny said...

Great post. Any ideas on how best to trade this CP?

CP said...

I think it's just an argument to substitute platinum for any gold that you own.

If you are a strong believer in the ratio, you could always do a pair trade with the ETFs.