Investing in Palladium
Palladium, a platinum group metal, is a rare element used primarily in the automotive, chemical, jewelry and dental industries and may offer investors some of the best opportunities in the precious metals complex in the years ahead. While past performance is not indicative of future results, in both 2010 and 2013, palladium outperformed gold, silver and platinum in terms of year-over-year price appreciation in percentage terms. And analysts at the CPM Group, in their ''2014 PGM Market Outlook'' report written exclusively for Monex, believe palladium will continue to outperform the other precious metals in 2014 and, quite possibly, years more into the future.
The reason? Palladium demand has been steadily increasing in recent years, while at the same time, available supplies of the metal to fill that demand have not. In fact, in 2013, fabrication demand for palladium actually exceeded available supplies, and the CPM Group believes this palladium market supply deficit situation will continue through 2014 and perhaps well beyond. It is a basic economic tenet that as demand increases and supplies remain the same or decrease, price tends to rise. Palladium's performance in the last several years certainly appears to reinforce that principle.
The majority of the world's supply of palladium comes from just two countries: Russia and South Africa. Russia currently accounts for close to 40% of annual global mine supplies, with South Africa producing slightly less. Output from mines in other parts of the world, as well as supplies from recycling efforts, make up the balance of available supplies. The demand side of the equation, though, is what has attracted the interest of investors: fabrication and investor demand has increased every year for the past five years. And the primary source of this increased demand? Gasoline-powered vehicles, which require palladium in their catalytic converters to control exhaust emissions. Rapidly growing gasoline-powered vehicle production in the U.S., China, India and elsewhere demand increasing supplies of palladium . . . at a time when the world simply can't produce it fast enough or in the quantities needed.
With the attractive supply/demand fundamentals, combined with the relatively small size of the market compared to the gold and silver markets, it is easy to see why investors are attracted to palladium as a way to diversify an investment portfolio and speculate in an often-volatile and fast-moving market. Monex has been a leader in physical palladium investments for many years and would be pleased to discuss how a palladium investment could be incorporated into your personal investment program.
Buying palladium bullion is a convenient and cost-effective way to invest in the often-exciting palladium market. With the market's impressive supply/demand fundamentals, and growing prospects for a potential supply squeeze in the year's ahead, an investment in physical palladium bullion may be one of the best bets on the board now and in the years ahead. Monex offers palladium bullion in 10-ounce bars of .9995 fineness for delivery, storage and as a trading vehicle in the Monex Atlas Account. Each bar we offer is hallmarked by a leading refiner to certify the bar's weight and purity.More Information
Purchasing palladium bullion coins can be an outstanding way to invest in the palladium market, as coins are easy to buy, hold, sell and trade. In addition, should it be necessary, coins can be divided up into smaller units, unlike larger bullion bars. Monex offers Palladium Canadian Maple Leaf palladium bullion coins exclusively, in units of 10 one-ounce coins. Each coin is comprised of pure, .9995 fine palladium and truly beautiful. Palladium Maple Leaf bullion coins are produced in accordance with the Royal Canadian Mint's exacting standards, and each coin's weight, purity and face value are guaranteed by the Canadian government.More Information