Best of the Week
Most Popular
1.Are UK Savings Interest Rates Finally Starting to Rise? Best Cash ISA 2017 - Nadeem_Walayat
2.Inflation Tsunami - Supermarkets, Retail Sector Crisis 2017, EU Suicide and Burning Stocks - Nadeem_Walayat
3.Big Moves in the World Stock Markets - Big Bases - Rambus_Chartology
4.The Next Financial Implosion Is Not Going To Be About The Banks! - Gordon_T_Long
5.Why EU BrExit Single Market Access Hard line is European Union Committing Suicide - Nadeem_Walayat
6.Trump Ramps Up US Military Debt Spending In Preparations for China War - Nadeem_Walayat
7.Watch What Happens When Silver Price Hits $26...  - MoneyMetals
8.Stock Market Fake Risk, Fake Return? Market Crash? - 2nd Mar 17 - Axel_Merk
9.Global Inflation Surges, Central Banks Losing Control and Triggered the Wage Price Spiral? - Nadeem_Walayat
10.Why Gold Will Boom In 2017 - James Burgess
Last 7 days
Top Ten US Dollar Risks - 27th Mar 17
The Popularity of Gambling and Investing Amongst Students - 27th Mar 17
Is Political Betting on the Rise? - 27th Mar 17
US Stock Market Consolidation Time - 27th Mar 17
Russia Crisis - Maps That Signal Growing Instability and Unrest - 27th Mar 17
Goldman Sachs Backing A Copper Boom In 2017 - 27th Mar 17
Foundation – Fall Of The American Galactic Empire - 27th Mar 17
Stock Market More Correction Ahead - 27th Mar 17
US Dollar Inflection Point - 27th Mar 17
Political Week Presurres US Stock Market - 25th Mar 17
London Terror Attack Red Herring, Real Issue is Age of Reason vs Religion - 25th Mar 17
Will Washington Risk WW3 to Block an Emerging EU-Russia Superstate - 25th Mar 17
Unaccountable Military Industrial Complex Is Destroying America and the Rest Of The World Too - 25th Mar 17
Silver Mining Stock Fundamentals - 24th Mar 17
A Walk Down the Dark Road of Bad Government - 24th Mar 17
Is Stock Market Flash Crash Postponed Until Monday? - 24th Mar 17
Stock Market Bubble and Gold - 24th Mar 17
Maps Of Past Empires That Can Tell Us About The Future - 24th Mar 17
SNP Independent Scotland's Destiny With Economic Catastrophe, the English Subsidy - IndyRef2 - 24th Mar 17
Stock Market VIX Cycles Set To Explode March/April 2017 – Part II - 23rd Mar 17
Is Now a Good Time to Invest in the US Housing Market? - 23rd Mar 17
The Stock Market Is a Present-Day Version of Pavlov’s Dog - 23rd Mar 17
US Budget - There’s Almost Nothing Left To Cut - 23rd Mar 17
Stock Market Upward Reversal Or Just Quick Rebound Before Another Leg Down? - 23rd Mar 17
Trends to Look Out For as a Modern-day Landlord - 23rd Mar 17
Here’s Why Interstate Health Insurance Won’t Fix Obamacare / Trumpcare - 23rd Mar 17
China’s Biggest Limitations Determine the Future of East Asia - 23rd Mar 17
This is About So Much More Than Trump and Brexit - 23rd Mar 17
Trump Stock Market Rally Over? 20% Bear Drop By Mid Summer? - 22nd Mar 17
Trump Added $3 Trillion in Wealth to Stock Market Participants - 22nd Mar 17
What's Next for the US Dollar, Gold and Stocks? - 22nd Mar 17
MSM Bond Market Full Nonsense Mode as ‘Trump Trades’ Unwind on Schedule - 22nd Mar 17
Peak Gold – Biggest Gold Story Not Being Reported - 22nd Mar 17
Return of Sovereign France, Europe’s Changing Landscape - 22nd Mar 17
Trump Stocks Bull Market Rolling Over? You Were Warned! - 22nd Mar 17
Stock Market Charts That Scream “This Is It” - Here’s What to Do - 22nd Mar 17
Raising the Minimum Wage Is a Jobs Killing Move - 22nd Mar 17
Potential Bottoming Patterns in Gold and Silver Precious Metals Stocks Complex... - 22nd Mar 17
UK Stagflation, Soaring Inflation CPI 2.3%, RPI 3.2%, Real 4.4% - 21st Mar 17
The Demise of the Gold and Silver Bull Run is Greatly Exaggerated - 21st Mar 17
USD Decline Continues, Pull SPX Down as well? - 21st Mar 17
Trump Watershed Budget - 21st Mar 17
How do Client Acquisition Offers Affect Businesses? - 21st Mar 17
Physical Metals Demand Plus Manipulation Suits Will Break Paper Market - 20th Mar 17
Stock Market Uncertainty Following Interest Rate Increase - Will Uptrend Continue? - 20th Mar 17
Precious Metals : Who’s in Charge ? - 20th Mar 17
Stock Market Correction Continues - 20th Mar 17
Why The Status Quo Is Under Increasing Attack By 'Populist People Power' - 20th Mar 17

Market Oracle FREE Newsletter

Elliott Wave Trading

Platinum is the Next Profit Opportunity in China's Commodity Boom

Commodities / Platinum Feb 13, 2013 - 05:01 PM GMT

By: GrowthStockWire

Commodities

Matt Badiali writes: Over the last month, I've shown you how China's economy has seen a resurgence in commodities imports like copper, iron ore, uranium, and coal.

China is the largest importer of industrial commodities in the world... So when its demand picks up, it's bullish for the sector.


Last week, I showed you the most compelling chart of all – China's monthly car sales are soaring again. And that's the launching pad for the next exciting installment of the commodity boom story...

I'm talking about platinum. And if you buy platinum assets right now, chances are good that you'll double your money over the next year or two.

Platinum is a "dual purpose" metal. It's used in jewelry... and it's considered a "store of wealth," so it serves as a precious metal like gold. But it's also an industrial metal. It is used to make catalytic converters – which reduce a vehicle's pollutants – and as a catalyst for refining gasoline and diesel fuel. Those two sectors account for 57% of the platinum produced per year. And demand is soaring...

China is the world's largest car market... and its sales were up 31% from July to December. Car sales in the U.S. – the world's second-largest car market – are the highest they've been in five years.

But while demand soars, platinum supply is in big trouble...

The metal is extremely rare... Unlike gold, which is mined on nearly every continent, 72% of the world's platinum supply comes from one volatile country: South Africa. Production in the country peaked in 2006 and has fallen 20% since. Thanks to mining strikes, aging, drying-up mines, and power-supply problems... platinum production fell 12% from 2011 to 2012 alone.

This is causing a big imbalance in platinum supply and demand. That should result in rising prices. But the market hasn't seemed to notice...



Thanks to economic troubles in the U.S., Europe, and China, platinum fell – along with the rest of the commodities market – in 2011 and 2012. Prices declined to $1,400 per ounce. And they have bounced between $1,400 per ounce and $1,700 per ounce since.

More importantly, platinum is trading at a discount to the price of gold.

Platinum has only fallen below the price of gold three times in the past 37 years. It historically trades at a 30%-70% premium to the price of gold. So based on history, platinum can't stay this cheap for long...

As the global economy continues to recover – and automobile consumption increases along with it – we should see platinum prices rise at least to their long-term average of 30% above the price of gold. That would put the platinum price around $2,200 per ounce today.

The fundamentals look ripe for a huge move higher. But until that happens, the market is giving us an incredible opportunity to take advantage of these dirt-cheap prices...

One of the best ways to do so is through shares of the Sprott Physical Platinum and Palladium Trust (NYSE: SPPP). SPPP is a new platinum fund formed by famed resource investment management firm Sprott Asset Management. And it gives you exposure to physical bullion – without involving the banks.

This fund has an extra benefit for U.S. investors... If you hold the units for at least one year, gains you make on your investment are only taxed at a maximum of 20%. That is well below the 28% tax on most bullion investments.

So far, 2013 is offering us far more commodity investing opportunities than we saw last year. Platinum is the next exciting installment. I hope you take advantage.

Good investing,

Matt Badiali

http://www.growthstockwire.com

P.S. Platinum is one of the cheapest investments you can make anywhere in the resource sector right now. So in the most recent issue of my S&A Resource Report, I introduced readers to one of the best ways to play it. If things go right with platinum prices and this miner's projects, we could easily double our money in 2013. To learn more about the S&A Resource Report – and access this brand-new report – click here.

 

The Growth Stock Wire is a free daily e-letter that provides readers with a pre-market briefing on the most profitable opportunities in the global stock, currency, and commodity markets. Written by veteran trader Jeff Clark, and featuring expert guest commentaries, Growth Stock Wire is delivered to your inbox each weekday morning before the markets open.

Customer Service: 1-888-261-2693 – Copyright 2009 Stansberry & Associates Investment Research. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This e-letter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), in whole or in part, is strictly prohibited without the express written permission of Stansberry & Associates Investment Research, LLC. 1217 Saint Paul Street, Baltimore MD 21202

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Growth Stock Wire Archive

© 2005-2016 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife