Metals Minute 28: Basel III and Precious Metals
Today, we will look at a new dynamic affecting the precious metals market and highlight how owning physical precious metal can possibly double your gains vs owning precious metal ETFs.
For the week, gold is up 2% to $1,876, silver is up 2% to $27.87, platinum is down 4% to $1,200, and palladium is down a further 2% to $2,905.
For the 1-yr time frame, gold is up 7%, silver is up 60%, platinum is up 43%, and palladium is up 43%.
There is an investment demand for physical gold and silver taking hold, which platinum and palladium do not garner. Due to Basel III and the #SilverSqueeze movement, physical investment demand for silver has risen beyond industrial demand for the first time in recent memory. You can read more about Basel III here, in this week's article.
Just as some oil ETFs imploded last year (UWT, for example) when oil dropped in price, metal ETFs are in danger when metal rises in price. Since we began informing our readers about Basel III, the spot price of silver is up 89%. But the price for a physical ounce Silver Eagle is up 164%. ETF holders missed out on the additional gains that only owning the metal can provide.