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Precious Metals

Precious metals are rare and/or highly valued metals. They include, but are not limited to, gold, silver, platinum, iridium, rhodium and palladium. Investment can be made by purchasing the physical asset or by purchasing futures contracts for the particular metal using the commodity exchanges. Another investment option is to invest by purchasing shares of publicly traded mining companies that undertake exploration or production of precious metals.

Gold

Gold is an alluring investment because it provides an ability to preserve the value of the investment over time and is typically a good means of diversifying an investment portfolio. It also provides a hedge against macro economic trends since the world is becoming increasingly integrated in terms of economics, resources and culture. Events in one part of the world can have an immediate and lasting impact on other parts. Highly integrated economies offer many advantages but at the same time are increasingly prone to single events. Finally, gold is a good hedge against geo-political risk and uncertainty. The enormous trade imbalances, China’s ascension as an economic power-broker and many other factors may lead to geopolitical tensions. As a result, investors may wish to hedge against these global fluctuations.

Silver

An element commonly used in jewelry, coins, electronics, and photography. Silver has the highest electrical conductivity of any metal. It is an effective way to diversify investment assets and preserve wealth against inflation. Silver is used as a raw material in a number of different products. This valuable commodity gains its value because of its limited availability.

Platinum

Platinum is an element that is often used in jewelry or as a catalyst in electronics.