A few articles on the prices of precious metals. I was a bit surprised to learn that the demand driving up the price of platinum is diesel auto makers and not my wife's demand for jewelry. *phew*
Where will these prices go now?
Some good tips on investing in metals (and how not to).
Investing in Metals Hits a Fever Pitch
Wall Street Woos The Small Investor, But Know the Risk
December 3, 2005
It's like the 1980s all over again.
Gold closed Friday at $503.30 an ounce, its highest price since Feb. 21, 1983. It is up 15% since Jan. 1. Platinum, meanwhile, topped $1,000 an ounce earlier this week, its highest level in more than two decades.
Analysts credit a number of factors for precious metals' sharp rise. Demand from investors, afraid of rising inflation and looking to protect their portfolios by diversifying, is helping to drive up the price. Increased industrial use of the metals is also contributing, as is demand in developing nations such as China and India for their use as jewelry and as a store of wealth.
As precious-metals fever heats up, Wall Street is rolling out more products geared to small investors, including exchange-traded funds and so-called structured notes. And some financial advisers are steering their clients into precious or industrial metals as a way to diversify their portfolios and protect them from inflation.
Investors, for their part, have been pouring money into mutual funds that specialize in precious metals. Through the end of October, $826 million flowed into three precious-metals funds offered by Fidelity Investments, Vanguard Group and Franklin Templeton, as compared to $101 million for all of 2004, according to TrimTabs Investment Research.
"We have investors who think they want [metals] but don't understand the risk of volatility in the marketplace," says Fred Whaley, managing director of Raymond James Financial Inc.'s alternative-investments group in St. Petersburg, Fla.
Gold hits $500/oz
Gold Futures Pierce $500 Barrier
For First Time in Nearly 2 Decades
November 30, 2005
Gold futures broke through the $500-an-ounce barrier for the first time in nearly two decades during Asian trading yesterday, but gave back some of its gains to settle just under that level on the Comex division of the New York Mercantile Exchange.
Most of the action happened overnight in Asia, where Japanese investors showed "a particular appetite for the metal," said analysts at MKS Finance SA in Geneva.
"There is strong interest from the speculative community and gold is now being viewed as a currency," said Mr. O'Neill, who added that demand out of the Middle East is also underpinning the market.
While the rally that pushed gold above $500 in late 1987 was seen as short-lived, market players contend that this rally is more sustainable.
Platinum hits $1000/oz
Platinum Prices Top $1,000 Mark Amid Strong Industrial Demand
November 29, 2005
NEW YORK -- Platinum prices continued to move higher as the precious metal topped the $1,000 mark for the first time in 25 years amid strong demand fundamentals and continued buying interest from speculators.
Traders said firm demand fundamentals and strong interest from funds are keeping the precious metal buoyant. The automotive and jewelry sectors are the two biggest consumers of platinum.
The main driver behind platinum's rise is the demand from the auto sector, which will climb by 300,000 ounces to 3.86 million ounces amid growing demand for platinum auto catalysts for diesel cars and trucks in Europe, Japan and the U.S., the Johnson Matthey report said.
Demand for auto catalysts, where platinum is used to cleanse emissions, is taking platinum prices to new highs as the diesel sector gains momentum in Europe.
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