Beyond Gold and Silver: An Introduction to Platinum and Palladium

Published on: September 5, 2025

While gold and silver dominate the conversation, platinum and palladium are two other precious metals that offer unique investment opportunities. Both are significantly rarer than gold and are heavily reliant on industrial demand.

Platinum: The "Rich Man's Gold"

Historically, platinum often traded at a significant premium to gold, earning its nickname. It is incredibly dense and rare. Its primary industrial use is in catalytic converters for diesel vehicles to reduce harmful emissions. It is also used in jewelry and other industrial processes.

• Key Drivers: Automotive industry health (especially diesel), jewelry demand, and supply disruptions from major producers like South Africa and Russia.
• Investment Case: Some investors buy platinum when it trades at a significant discount to gold, betting on a reversion to the historical mean.

Palladium: The Automotive Powerhouse

Palladium is a sister metal to platinum and has become a critical component in the modern world. Its primary use—accounting for over 80% of demand—is in catalytic converters for gasoline-powered vehicles. This has made its price extremely sensitive to automotive production numbers and emissions standards.

• Key Drivers: Global car sales (gasoline engines), emissions regulations, and the supply chain, which is heavily concentrated in Russia.
• Investment Case: Palladium is a play on the continued dominance of gasoline cars and tightening environmental laws. Its price can be extremely volatile due to its tight supply-demand balance.

Risks and Rewards

Both platinum and palladium are highly dependent on the automotive industry. The global shift towards electric vehicles (EVs), which do not use catalytic converters, poses a long-term structural risk to their demand. However, in the short to medium term, supply constraints and continued vehicle production can lead to significant price movements, offering both high risk and high reward for savvy investors.