Platinum Investment 2025: Why Is This Precious Metal Severely Undervalued?

The “Neglected” in Price Comparisons

The precious metals market remains hot, but the phenomenon is intriguing: Gold has already broken through $3,300 per ounce, and Silver has crossed the $38 mark, while only Platinum, a rare precious metal, receives little attention in investment portfolios. In fact, platinum’s rarity far exceeds that of gold, so why is it being overlooked?

Data speaks. In 2014, platinum prices reached as high as $1,500 per ounce, easily surpassing gold prices at the time. Now, the situation has reversed—gold has risen steadily, reaching a record high of $3,500 in April 2025, while platinum has fluctuated over the past decade, even dropping to a low of $600 in early 2020. It wasn’t until 2025 that platinum rebounded, climbing back to around $1,450 per ounce in July.

The True Picture of the Platinum Market in 2025

According to the World Platinum Investment Council, global platinum demand in 2025 is expected to reach 7,863 thousand ounces, with supply at only 7,324 thousand ounces, resulting in a structural supply shortage of up to 539 thousand ounces. What does this mean?

Supply-side dilemma: Mine production growth is only 1%, with major producers like South Africa facing extraction difficulties. However, the recycling market may grow by 12%, presenting a potential breakthrough.

Demand-side divergence:

• Automotive industry accounts for 41% (3,245 thousand ounces)
• Industrial applications 28% (2,216 thousand ounces, expected to decline 9%)
• Jewelry consumption 25% (1,983 thousand ounces)
• Investment demand 6% (420 thousand ounces, up 7%)

This structural imbalance drives platinum’s neutral to slightly bullish trend in 2025—tight supply but stable demand, suggesting prices may remain firm.

Historical Reflection: From Obscurity to Industrial Darling

Platinum’s investment history is relatively young. While gold and silver have been used as currency since the Middle Ages, platinum only appeared in the 19th century. Russia was the only country issuing platinum coins, but a ban in 1845 led to oversupply and a price crash.

The real turning point came with industrial demand:

• 1902, Ostwald-Verfahren patent paved the way for automotive catalysts
• 1924, platinum prices soared to six times gold
• Post-2000, platinum entered a golden era, peaking at $2,273 per ounce in March 2008

This peak was driven by safe-haven demand during the financial crisis and rising industrial cycles. During economic downturns, demand declines; during recovery, platinum—known as an “industrial precious metal”—often rises against the trend.

Why Did Platinum Suddenly Rise in 2025?

From $900 in January 2025 to $1,450 in July, a gain of over 50% in half a year. What triggered this?

Supply crisis: Structural barriers in South Africa and other producing regions
Extreme scarcity: High financing lease rates reflect market tension
Geopolitical factors: Global uncertainties boost safe-haven demand
Demand resilience: Jewelry and industrial procurement in China and other regions remain unexpectedly stable
Weak dollar: A soft dollar supports dollar-denominated commodities
Capital inflows: ETF holdings grow, creating new investment demand

The combination of these factors has created a so-called “perfect storm.”

Platinum vs. Gold: Why Should Investors Reconsider?

Gold’s advantages: Inflation hedge, no industrial consumption, strong global consensus

Platinum’s uniqueness:

• Greater physical scarcity
• Widespread industrial applications (auto catalysts, medical implants, green hydrogen fuel cells, fertilizer production)
• Supply-demand contradictions more easily trigger price volatility
• Long-term investment return potential underestimated systematically

Interestingly, platinum has low correlation with stocks, making it an effective hedge in a portfolio. During economic upswings, platinum as an industrial commodity often outperforms; during stagnation, gold demonstrates its store-of-value function.

Investment Methods Overview

Physical purchase: Platinum coins, bars, or jewelry can be obtained through precious metals dealers or banks, but face storage costs and transaction fees.

ETF/ETC products: No physical holding needed, automatically track price movements, suitable for ordinary investors. Some trading platforms offer convenient account opening and position management.

Mining company stocks: Participate in the growth of platinum mining enterprises.

Futures and options: Suitable for professional investors, high risk but high reward potential.

Platinum CFD trading: Starting from 1 euro with low thresholds and flexible leverage (e.g., 5x, 10x), enabling active traders to leverage small capital for larger gains.

How Traders Can Handle Volatility?

Platinum’s high volatility offers opportunities for short-term traders. Trend-following strategies are common:

Using a 10-period fast moving average and a 30-period slow moving average, buy when the fast crosses above the slow (e.g., 5x leverage), and sell when it crosses below. The key is risk management:

• Limit risk per trade to 1-2% of total capital
• Set stop-loss points (e.g., 2% below entry price)
• Example: €10,000 capital, maximum risk per trade €100, corresponding to a €1,000 position at 5x leverage

This way, even with 3-5 consecutive losses, the account can survive.

A Conservative Path for Risk-Averse Investors

For risk-averse investors, platinum can serve as a component of an existing stock portfolio. Periodically adding platinum positions (e.g., 5-10% of total assets) leverages its independent supply-demand cycle and diversification benefits. Combining periodic rebalancing with a multi-precious metals portfolio (gold + silver + platinum) can balance risks.