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The post What Are Precious Metals? by Sarah Edwards appeared first on Benzinga. Visit Benzinga to get more great content like this.
Precious metals are rare, naturally occurring elements with high economic value due to their scarcity, durability, and diverse industrial and investment uses. The most well-known precious metals include gold, silver, platinum, and palladium—each prized for its unique properties and role in global markets.
Beyond jewelry and currency, these metals are essential in technology, medicine, and green energy production. For investors, precious metals serve as a hedge against inflation and market volatility, offering a tangible store of value that has stood the test of time.
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What is Considered a Precious Metal?
A precious metal is a rare metal that occurs naturally. There are eight main kinds of precious metals traditionally used as investment assets. Silver and gold are the most popular; the other six are part of the platinum group and similar metals. Let’s take a look at them.
- Gold: Gold is one of the most well-known and sought-after precious metals, prized for its rarity, durability, and timeless appeal. As a chemical element, it is highly resistant to corrosion and tarnishing, which has made it a symbol of wealth and power throughout history. Its unique properties, such as malleability and conductivity, also make it valuable in various industries, from electronics to jewelry. In addition to its practical uses, gold holds a strong position as a safe-haven asset, often serving as a hedge against inflation and economic instability, making it a popular choice for investors.
- Silver: Silver is most often used to make jewelry, conductors, and other electronic components. It’s one of the most popular precious metals to invest in, though it historically hasn’t been as steady in terms of its performance over time, but it’s much more volatile than gold.
- Platinum: Platinum can sometimes be used for expensive jewelry, but it’s also an important component in catalytic converters for cars, some types of medications, LCDs, and spark plugs.
- Palladium: Palladium is used a lot, just like platinum. However, palladium investments usually include other metals because it’s so rare.
- Rhodium: Rhodium is mostly used in the aerospace and chemical industries. It’s extremely rare and expensive, so it hasn’t always been viewed as the most stable investment option. But it’s worth considering for investors who want to diversify their portfolios with something a little different (so long as they can afford it).
- Ruthenium: This one is much rarer than gold, silver, platinum, and palladium. It can be used to coat other metals to give them extra shine and protect them from scratches and corrosion. But like many platinum-group metals, it’s mostly used in the automotive industry to make catalytic converters.
Factors Influencing the Rarity and Value of Precious Metals
What exactly makes precious metals rare and appreciated by consumers and industries alike? There are several factors, including the following:
Geological Conditions
Metals — especially rare metals — aren’t available everywhere in the world. Depending on their location, only certain mining companies may be able to access them. If only a few mining companies can access a type of precious metal, they can control the price.
Mining and Extraction Process
Sometimes, mines produce more or less of a given type of precious metal. If a mine is less productive than normal, there might be a supply bottleneck. In this scenario, prices may increase. Likewise, if mines produce more of a metal, prices may drop for a time.
The complexity of mining and extraction can also shape the value of a metal. For instance, if the process of obtaining and purifying it is lengthy or difficult, or requires specialized equipment, the metal might be more expensive.
Relationship with the Global Economy and Market Demand
What are precious metals worth? The answer depends in part on how in demand they are.
For example, platinum and similar metals are an important part of catalytic converters. During the COVID-19 pandemic, the manufacturing of cars dropped considerably from a combination of a worldwide slowdown in the industry and a lack of raw materials. There was less demand for metals in the platinum group, so prices fell.
We can’t predict what will happen in the future with precious metals prices — as COVID-19 showed us, anything is possible. That’s why it’s so important to do your due diligence before investing and not play with money you can’t afford to lose. Precious metals can dip in value just like any other asset class.
Role of Precious Metals as a Historically-Steady Asset Class
Steady assets have typically maintained a certain level of consistency during inflation or economic turmoil — sometimes, in fact, their value increases.
Understandably, smart investors have diversified their capital during market downturns in ways that add a layer to correlated assets. As a result, metals that have traditionally held steady value tend to be popular choices.
Gold is a great example. Of all the precious metals, it’s historically been one of the best hedges against inflation and other turbulent economic times, even though its practical uses have become more limited over the centuries. For this reason, it’s arguably been the top choice for investors interested in diversifying with precious metals.
Benefits of Investing in Precious Metals
These investments can be a great way to round out and add diversity to your portfolio. Here are some traditional aspects of investing in precious metals:
- Usually, solid long-term investments
- Can buttress your correlated assets during inflation
- They aren’t generally tied to other asset classes, so they have performed steadily even when others take swings
- In demand due to rarity
You shouldn’t invest everything in precious metals, just as you shouldn’t sink all your resources into any single investment type. The smartest investors understand that only a portion of their savings should be held in a precious metals IRA.
Risks of Investing in Precious Metals
No investment type is without risks. Here are some potential downsides to investing in precious metals.
- The metals market can be unstable
- May have high capital gains taxes
- No guarantee of future performance from past performance
- Potential for geopolitical problems
Comparing risks and benefits is an essential part of making sound investment choices. If you’re new to the investment world, an experienced financial adviser can help you weigh the pros and cons and decide whether a given investment is right for you.
How to Begin Investing in Precious Metals
If you want to ensure a smooth procedure, you’ll need to take a few things into account.
Evaluate Your Risk Tolerance
Take a look at what risks you’re willing to take. All precious metals have different risk profiles. Make sure you investigate each one before choosing to invest in it.
Create Clear Investing Goals
If you don’t know what you want to achieve, it will be hard to come up with a good investment strategy. Talking to an investment adviser can help you develop clear goals. Once those goals are set, you’ll be able to decide what types of precious metal investments you want to pursue.
Decide How You Want to Invest
There are many different ways to invest in precious metals. One option is to actually to buy physical metal, usually in the form of bars or bullion coins. Exchange-traded funds (ETFs) can make investments as well. Futures are riskier, and you should not invest in them without speaking to a trusted advisor first. Some investors also choose to invest in mining stocks.
Decide What You Want to Invest In
Once you have set goals and know your risk tolerance after speaking with a trusted advisor, you can choose one or more metals to invest in. Popular precious metals like gold and silver usually offer the most options.
Where to Invest in Precious Metals
American Hartford Gold is a family-owned business based in Los Angeles, California. The organization is a market leader in precious metal investing. American Hartford Gold specializes in selling gold, silver, platinum, and palladium coins and bars and in helping its clients to set up Individual Retirement Accounts (IRAs) invested in precious metals.
Precious metals are popular investments during times of high inflation as investors look for a hedge against inflation. Gold and silver investments may not follow the same trends as stocks, making precious metal investing a potential safe haven.
American Hartford Gold offers investors the following services:
- Gold, platinum, palladium and silver investments
- Gold IRAs
Investors need an amount of $10,000 or more to start their retirement investment journey with American Hartford Gold. The company also assists investors looking to roll their current IRAs into gold IRAs. There are no taxes or penalties on either the trustee-to-trustee or 60-day rollover IRA options it offers. American Hartford Gold will buy back the precious metals when investors want to cash out.
Best For
- Investors looking for a hedge against inflation
- Retirement savers looking for tax benefits
- Quick & easy 3-step tax-free, penalty-free Gold IRA setup
- Same day IRA – fastest in the industry
- Ranked #1 Gold Company on the Inc 5000 List and A+ Rated on BBB
- Up to $15,000 in FREE silver on qualified accounts
- Lowest price guarantee, best ongoing promotions, no buy-back fees
- Wide range of investment-grade gold and silver products, including popular coins like American Gold Eagles and Canadian Silver Maple Leafs
- The company provides a wealth of information on investing in precious metals, including guides on the benefits of gold and silver investments
- Online catalog doesn’t show pricing
- No international shipping available outside of the U.S.
Preserve Gold is a precious metals investment company that specializes in helping individuals diversify their portfolios with gold, silver, and other precious metals. With economic uncertainty and inflation concerns driving increased interest in tangible assets, Preserve Gold positions itself as a trusted partner for those looking to safeguard their wealth. In this review, we’ll take a closer look at the company’s offerings, reputation, pricing, and customer service to help you determine whether Preserve Gold is the right choice for your investment needs.
Best For
- Retirement investors seeking reputable and knowledgeable dealers for setting up Gold IRAs to safeguard their retirement savings
- Individual investors looking for a trusted and reliable precious metals source to diversify their portfolios and protect from inflationary pressures
- Experienced precious metal investors interested in expanding their catalogs and turbocharging their portfolio with a wide range of precious metals, including gold, silver, platinum, and palladium
- Novice investors seeking transparent and integrity-driven precious metal dealers to provide them with the guidance and support needed to understand the world of precious metals investing
- Those interested in acquiring precious metals for collections or decorative purposes may also benefit from the price appreciation
- Zero-pressure sales tactics, excellent Trustpilot reviews and no BBB complaints
- 24-hour satisfaction guarantee — cancel your purchase within 24 hours of completing the transaction and receive your money without penalty, regardless of the reason
- Competitive pricing — they can price-match or beat the price of their competitors
- Excellent buyback policy — zero liquidation fees for existing clients
- Lifetime account support from a dedicated precious metals specialist
- Extensive catalog of major precious metals, including gold, silver, platinum, and palladium
- Excellent educational resources, including ebooks, informational kits, and market outlook
- Reputable company whose executive team has 30+ years of combined experience streamlining precious metal investment
- Free, insured, and fast shipping within one week of payment clearance
- Limited fee information online — investors must call or fill out a form to get metal pricing
- US customers only
Priority Gold is a precious metals investment company specializing in gold, silver, platinum, and palladium. It offers investors a way to diversify their portfolios through physical bullion purchases and self-directed precious metals IRAs. Known for its customer service and educational resources, Priority Gold aims to help both novice and experienced investors navigate the complexities of precious metals investing.
In this review, we’ll examine Priority Gold’s services, pricing, security, and overall customer experience. Whether you’re looking to hedge against inflation or secure long-term wealth, understanding the pros and cons of investing with Priority Gold can help you make an informed decision.
Best For
- Anyone seeking to set-up a Gold or Silver IRA or rollover
- Beginner gold and silver buyers looking for a transparent and integrity-driven precious metals company
- Reasonable and fair pricing
- Buy Back and Price Protection plans
- Insured and robust IRS-approved vaults/depositories for IRA gold and silver storage (3 years free storage for eligible accounts)
- An impressive selection of rare and widely held precious metals products, including IRS-eligible gold and silver coins
- Unconditional and zero-fee precious metals buyback or a repurchase program guarantee
- Accessible and responsive customer service personnel available across multiple channels including phone and email
- A+ Rated on BBB and 5 star rating on TrustLink
- Expert gold and silver consultancy services offered by certified precious metals specialists who provide comprehensive guidance and support
- An insured and expedited shipping process
- Excellent research and educational resources, including a free precious metals and IRA kit
- Gold and silver coins dominate the precious metals product selection; customers who prefer larger bullion bars, rounds, and other forms of gold and silver might consider looking elsewhere
- No live chat
- No platinum and palladium, unlike some of its competitors
Precious Metals: A Shiny New Addition to Your Diverse Portfolio
Precious metals have been a great choice for smart investors looking for an alternative investment to diversify their portfolios. Best of all, there are several precious metals out there, each with its own risk profile, so interested investors have the opportunity to educate themselves on several different options.
Frequently Asked Questions
What are the five precious metals?
The five primary precious metals are gold, silver, platinum, palladium, and rhodium.
What is considered precious metal?
Precious metals are rare, high-value metals known for their durability and economic worth. The main precious metals are gold, silver, platinum, and palladium, though others like rhodium and iridium are also included. They’re prized for use in jewelry, industry, and as investment assets.
What is the king of all metals?
Gold is often called the “king of all metals” because of its rarity, beauty, and enduring value. It has been prized for thousands of years as a symbol of wealth and power, and it remains one of the most sought-after assets for investment and jewelry worldwide.
The post What Are Precious Metals? by Sarah Edwards appeared first on Benzinga. Visit Benzinga to get more great content like this.
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