Precious Metals Outlook Is Volatile

Are you a precious metals investor? Is it something you’re considering? If so, you have lots of questions. You want to know what the precious metals are, how valuable they are, what the precious metals outlook is, and why you should consider investing in them. Here’s a little information to help.

There are four precious metals: gold, silver, platinum and palladium. They’re all rare, they’re all beautiful, and they all have important practical uses, all of which makes them unusually valuable. There is also an investment market for each of these precious metals.

Why would you want to invest in them? The main value of a precious metals investment is to provide protection against economic volatility. When the economy crashes or inflation spikes, other investments can lose much or even all of their value. But precious metals always have some relative economic value and understanding the precious metals outlook could save you from the collapse of your other investments.

You may not want to invest all your money in precious metals. Prices can be volatile, and they may not do as well during strong economies. But as a hedge against recession and inflation, they can make an ideal financial choice.

Gold and Silver: Up and Down

Gold has the longest history of the precious metals: We’ve been using it for at least the last 7,000 years. It has a wide variety of uses, from dentistry and electronics to currency and industry. Even some gourmet foods are made with gold.

It’s also the most valuable of the precious metals. Its average price in 2012 was $1,679 an ounce, according to Citigroup. That price is forecast by Citigroup to drop to $1,675 in 2013 and $1,655 in 2014, marking two years of decline after 12 straight years of increases.

Silver dates back thousands of years and is mentioned in the early pages of the Bible. It was long ranked as second only to gold, and it has many uses, including tableware, medicine, currency, jewelry and clothing. It has the lowest per-weight value of the precious metals, however, and a poor precious metals outlook. Citigroup forecasts the price of silver will drop from an average of $31.30 per ounce in 2012 to $31 per ounce in 2013 and $26.50 per ounce the year after.

Platinum and Palladium: Room to Grow

Humans have been mining and using platinum for at least two millennia, but it has been a tradable commodity for a much shorter period of time than silver or gold. It’s used in chemistry, medical equipment, electrodes, decoration and jewelry, among other applications.

Platinum, which is exceptionally rare, is second only to gold in value. It had an average price in 2012 of $1,556 an ounce, according to Citigroup, which forecasts an increase to $1,675 in 2013 and $1,775 the next year, making the precious metals outlook for platinum bright.

Palladium is the upstart of the group, discovered only in 1803. Its primary role is in the making of catalytic converters, which turn polluting auto fumes into clean air. Palladium prices are expected to soar, with Citigroup forecasting an increase from an average price of $638 an ounce in 2012 to $744 in 2013 and $925 in 2014.

Precious Metals Outlook Is Volatile
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