Platinum is a precious metal with a light gray appearance. It is one of the rarest elements on Earth. South Africa is the main source of platinum, accounting for over 75% of the world’s production. In the automotive manufacturing industry, platinum is used mainly for catalytic converters as it’s quite resistance to high temperature and corrosion. Platinum may also be used for electrodes and other electrical contacts as it has a high level of electrical conductivity. Only a few hundred tons of platinum are produced annually, which can be traded at a premium to gold, but not always.
With practically every central bank around the world having the throttle fully open when it comes to monetary policy, investors with extra cash just lying around need to do something with it. While you could put this cash in a government bond or simply keep it in cash, these options aren’t going to help you beat the rate of inflation. Instead, investors should take a cue from the superrich and consider an investment strategy that includes hard assets.
As you may already know, an investment strategy that comprises hard assets includes traditional stores of wealth (such as gold and silver) and commodities (such as oil), as well as artwork and even cars.
While I advocate the traditional investment strategy of becoming a part owner in companies through equities, there are growing signs that even the superrich are becoming increasingly worried about having cash sitting idle and are looking at hard assets as part of their portfolio.
Just recently, a 1963 Ferrari “250 GTO” sold for $52.0 million! I like a nice car as much the next guy, but $52.0 million is a lot for one vehicle.
Obviously, the person buying it is not using it just to go grocery shopping; rather, it’s likely that the new owner is incorporating this item as part of their investment strategy to include hard assets (in this case, collectible cars).
To show you just how strong the market is for alternative hard assets by the extremely wealthy, a similar Ferrari 250 GTO sold last year for $35.0 million, which means this year’s sale is a 49% increase in price.
Of course, price appreciation in … Read More