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What Constitutes Precious Metals? Tips for Investors

by Olufisayo
Precious Metals

In the age of stock trading, precious metals are one of many growing sectors of economic trading that takes advantage of inherent value to produce an investment. What does this mean? Well, on a practical level it means that investing in metals like gold and silver can produce actual economic gains that range from minor hedging of your bets against the tide of the economy to full-on booms and busts. The trick to moving through this strange sector of the economy is to stay safe and not sign anything, but if you play your cards right you can win when everyone else loses.

Precious metal investment companies often trade in gold and silver, but what about those metals makes them precious? The fact is, if everyone decided all at once that gold was useless, we would have a hard time justifying Investing In Gold freely. But, these metals have a societal value that in many ways transcends their economic uses. Gold isn’t useful on its own in an ingot, but if I see one on the street and knew it was free you can bet I’d go and take it. So, what are the precious metals, and which ones should you invest in?

The Obvious Catches

Even diving into a field of study like linguistics you can find references to gold everywhere. These references are for the investor, as good as gold. Don’t worry about the worth of this particular metal at least, though it can range in price from the thousands to the hundreds, it will never hit anything below that. Momentum is a strong thing in finance because it links societal trends to bigger or smaller gains. Movements against particular companies for instance can make momentum swing against them, forcing them from the top or the bottom.

Gold has momentum, but so does silver. Silver is an underrated precious metal, often being worth pitiful amounts compared to its older brother. But, for many uses silver is by far the more flexible element. Silver is used for high-level industrial applications due to its ability to conduct heat and electricity. As these types of reactions become more common, and the nature of the element is exploited a bit further, you can bet the worth of silver will rise.

This is also true of 2 other elements: Platinum and Palladium, which have seen price leaps in recent years. They’re both rare and often found together, but more than that they have industrial applications in terms of catalytic converters and other similar machines. More than being useful though, these two elements combined are mostly household names. If someone hasn’t heard of palladium, bringing up its closeness to platinum is sure to make people understand.

Obscure Options

Since fundamentally the label of precious metals is determined by what we as people determine is valuable, this term is a bit meaningless. Though, for investors, obscure elements provide a risky approach that is equally rare. I have yet to hear or witness anyone with these investments available, and they may actually require special oversight from institutions like the IRS were they to start (much like gold, but more obscure). In general, though, there are other precious metals. Elements like Osmium and Iridium are common choices for a potential fifth candidate.

There is another choice in the platinum group, though, and that is Ruthenium which is sometimes lumped together with its siblings due to its common properties. But, it is a bit less valuable which makes it a better candidate for alloys. Alloys are a strange thing, though, and investment organizations generally stay away from them. But, they are worth discussing due to their potential worth differences from the metals that compose them. Before moving on, click here for an overview of other options for the illustrious title of precious metal.

Alloys, Just For Fun

When you combine two elements the fusion can sometimes create something more than the sum of its parts. This was true for bronze, an alloy of copper and tin that propelled states for over a thousand years. But, if you take in the intrinsic value of jewelry and other similar applications, sometimes the fusion of gold, silver, or other metals with non-precious metals can be a net gain financially.

“Investing in” something like this usually just means buying and storing, but if you want to “invest in” a gold alloy, rose gold and yellow gold are 18K and 22K variants (respectfully) of this valuable metal that are commonly used for jewelry. Rose gold is a common designer choice, and its distinctive color is a sought-after asset aesthetically that it can’t be or isn’t financially.

The inclusion of alloys as even somewhat valuable may clue you in, though, to the nature of gold investment. With these alloys, even a soft metal like gold can become a girl’s best friend, which means the value of the element is itself a factor. It isn’t just pure gold that’s such a powerful aspect, but the presence of the thing which makes it a desirable product.

Investment Conclusions

The obscure elements aren’t likely to be anyone’s possible choice for investment, nor are alloys, but they can clue us in to why gold and silver in particular are so valuable. They carry a weight that even industrial uses can’t replicate reliably. If suddenly an element were to solve global warming due to some new technology, chances are that still wouldn’t equal the ability of the precious metals to tempt the hearts of many a financier.

And this is for good reason, oftentimes gold investments counteract the loss of capital in other sectors. The physical objects become a bit easier to understand wanting when you see numbers all around the world go down and hearts sinking. So, if you want to invest in different precious metals, now’s the time, and you can create a highly diversified stock portfolio that will continue accruing wealth even in the worst of times around the world. Be careful, play the game of stocks smartly, and good luck!

Photo by Scottsdale Mint on Unsplash

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