WHY SHOULD I BUY PLATINUM?
Platinum is one of the rarest precious metals available. More recently the platinum market gained significant popularity as the world recognized its diverse uses in several different industries. There are multiple factors that make platinum an appealing commodity to investors.
First of all, there is huge support for platinum in the automobile industry. Global manufacturing growth escalates the demand for metals such as platinum. This might make platinum a good opportunity for investors in the long term.
Secondly, flexibility in investing options makes it easy to invest in platinum. You can buy platinum coins and bars, as well as future contracts. ETFs and equity options are also available, but if you want to own physical platinum bullion, you should make sure to buy from reputable dealers only.
If you already invest in gold and/or silver, you might consider diversifying your portfolio with platinum. Although this metal can also be volatile, diversity can significantly benefit your collection. Feel free to browse our inventory of platinum coins and bars, anytime.
ARE AN OUNCE AND A TROY OUNCE THE SAME?
The United States uses the troy ounce standard of measurement to measure the platinum spot price. The troy ounce has its origin in the French town of Troyes, and the U.S. Mint adopted it in 1828 for the regulation of coinage.
A standard ounce contains 28.349 grams, whereas a troy ounce contains 31.103 grams. This makes 1 troy ounce 2.75 grams more than a standard ounce. Today, troy ounces and grams are the only accepted ways to measure precious metals. The troy ounce measurement is significant to investors buying in bulk.
WHAT IS THE PLATINUM SPOT PRICE? WHY SHOULD I CARE ABOUT THE PRICE OF PLATINUM PER OUNCE?
The spot price refers to the current price of any precious metal such asthe price of silver or the price of gold per troy ounce. The spot price is the same internationally, so we all have an arbitrage-free platinum market. The stock market records the spot price of platinum and updates on a live basis. However, theplatinum spot pricechanges depending on the supply and demand of the metal. Other factors also may weigh on the price since it is a heavily industrial metal.
During times of economic turmoil or political instability, spikes or drops in the spot price can be significant. You can make a more informed investment decision if you know where the platinum spot price currently is, and where it is projected to go. Do not forget, Bullion Exchanges alerts provide you with email notifications when the spot prices reach significant lows or highs. Use this tool to your advantage.
WHY DOES THE PRICE OF PLATINUM CHANGE SO OFTEN?
Numerous global factors affect the platinum market, including interest rates, foreign relations, indexes, monetary policy, macroeconomic trends, fiscal policy, and beyond. For the most up to date news and analysis on precious metals markets, please follow ourblog.
WHAT AFFECTS THE PLATINUM SPOT PRICE?
Platinum is significantly rarer than both gold and silver. Therefore, the relatively low platinum supply automatically raises its price, making it one of the more expensive precious metals available to investors. However, the price of platinum per ounce still fluctuates, and it can sometimes be less expensive than gold. As a result, it is important for investors to stay aware of outside influences. Several factors influence its price, so read on to find out some of these exact factors.
BREAKDOWN OF PLATINUM SPOT PRICE INFLUENCES
Automobile Industry Demand – Platinum is a versatile industrial metal, and the automobile industry consumes more than half of the global platinum supply. This is because it is a vital component in car catalytic converters. With more support of climate change legislation, automobile manufacturers must make cars “cleaner.” Platinum converters better mitigate emissions for a cleaner and safer environment. Hence, the automobile industry is one of the most significant factors weighing on the price of platinum.
South Africa and Russia – A majority of the world’s platinum group metals comes from two places: South Africa and Russia. If these countries are involved in any natural disasters or go through any political/economic turmoil, it will cause serious fluctuations in the price of platinum. This is because mines can be strongly affected, such as being temporarily closed. This strains the platinum supply, which subsequently raises its price.
Jewelry – Another significant consumer of platinum is the jewelry industry. With more celebrities patronizing platinum than ever, the world has taken notice of this glistening white metal. It is now prized by jewelry collectors for its resistance to bending, tarnishing, and corrosion. Any alteration in demand for platinum jewelry can directly affect the platinum price.
Medical Industry Demand – Laboratory equipment, dentistry equipment, and even cancer treatment all consume platinum in some way. Demand in the medical field, as well as various other electrical industries, is significant enough to affect the price of platinum per ounce.
Stock Market – Just as gold and silver trade inversely with the stock market, so too does platinum! Because precious metals are considered safe haven assets, the platinum price per ounce may also rise as the stock market falls. However, since it is also an industrial metal, this might not always be the case.
HOW DO I LOCK IN A PRICE ON PLATINUM BULLION?
Each dealer may have different procedures when it comes to locking in prices for precious metals. A live price feed that automatically adjusts prices is used by most dealers, which constantly changes until you reach your checkout page. This will freeze your price in the checkout process. But if you take too long to submit your payment, the system might update your price for your order.
ARE PLATINUM PRICES THE SAME NO MATTER WHERE I LIVE?
Yes, the platinum price per ounce is the same around the globe, no matter the currency. For instance, the price of platinum in the United States is the same as the platinum price in England, China, India, and Russia. This is done to avoid any kind of arbitrage.
CAN I BUY PLATINUM AT SPOT PRICE? WHAT IS A PREMIUM?
When you buy any precious metal like platinum, you are almost never going to pay just the spot price of platinum. This is because the spot price does not include transportation, storage, manufacturing, or dealer costs. Therefore, platinum has its spot price and an additional premium over spot. Whether you purchase from a mint, refinery, or a dealer, you will most likely be paying at a premium price. Premiums account for these additional costs, and they can vary depending on the product, its mintage, and more.
This is why you usually cannot buy platinum at spot price. This premium or percentage is what helps investors decide on which dealer to buy their precious metals from. Consider that a PAMP Suisse Platinum Bar or a Platinum American Eagle Coincan have different prices with different dealers. Some offer at a low premium while others factor in higher premiums. This tends to vary according to supply and demand of the platinum bullion.
Bullion Exchanges allows you to buy platinum, especially top platinum products, with low premiums. Visit our Deals page to take advantage of the low premium platinum we currently offer. You can also sign up for our newsletters and automatically stay in the loop with our sales. At our discretion, we may run deals allowing you to buy Platinum at spot price, so don’t miss out!
DO I PAY TAX WHEN I BUY PLATINUM?
Every state has its own legislation relating to platinum buying. Some states charge sales tax on physical precious metals. Additionally, as of late 2019, some states have mandated that online retailers must collect sales tax on their behalf for certain precious metals shipping into their state.
For NY, there is a statewide sales tax of 4%, and there may possibly be a local sales tax on top of that. However, it is possible for tax exemptions to occasionally apply. Please review our tax page for more information on each state regarding sales tax policies.
WHAT ARE BID AND ASK PRICES?
The bid price of platinum is the current maximum price at which you can sell your platinum. The ask price is the current minimum price at which you can buy platinum.
The difference between the bid and the ask price is the bid-ask spread. If you plan on selling your platinum to a dealer, they will buy it from you at the bid price. Meanwhile, if you plan on buying platinum, the dealer will sell it to you at the ask price. The spread will be the dealer’s profit, and the ask price will always be higher than the bid price. However, the two prices should not have a significant percentage difference.
DOES THE FACE VALUE OF A PLATINUM COIN CHANGE ITS VALUE?
Platinum coins carry a face value that varies depending on its territory and weight. For example, the US Mint Platinum Eagle at 1 troy oz has a face value of $100 USD. This is the highest value to appear on a US coin. A Platinum Maple Leaf coin, on the other hand, has a face value of $50 Canadian dollars. That being said, the face value of a platinum coin does not affect its price. Platinum coins are valued solely for platinum content, mintage, and quality.
CAN I ADD PLATINUM TO MY IRA?
Depending on your IRA custodian, you might be able to buy platinum and add it to your independent IRA. Bullion Exchanges offers many fractional platinum bullion products, including fractional 1 gram weight. Therefore, you might not need an entire ounce to get started with buying platinum bullion.