Investing in precious metals

Investing in precious metals is a good way to diversify your portfolio in these uncertain times. So here is a run down on some of them, silver, platinum and palladium. Also note that some of these metals can be recycled, in particular from electronic devices.

Silver Bullion Guide

p>Silver is a soft, shiny and heavy metallic element with a brilliant white luster. Its atomic number is 47 and its chemical symbol is AG, derived from the latin Argentum, which means “white and shining”.

A very ductile and malleable metal, silver is very easy to work with, being only slightly harder than gold. Its thermal and electrical conductivity is the highest of all known metals. Of all metals, silver also possesses the lowest contact resistance.

Silver has the highest optical reflectivity amongst metals and is capable of achieving the most brilliant polish but it tarnishes when exposed to hydrogen sulphide, ozone, or air containing sulphur.

On the health front, silver is also a natural anti-bacteria agent and its antiseptic properties has been known since ancient times thousands of years ago.  

History of Silver

Silver has long been valued as a precious metal since antiquity and used as currency and in making ornaments and jewelry.

Like gold, silver has been known and used since the dawn of civilization. Silver ornaments fashioned out of pure silver were found in Egyptian royal tombs dating back to 3500 BC. Being a relatively scarce metal with a high value to weight ratio, silver was used, together with gold, as money as early as 700 BC by every nation in ancient Middle East.

At around 500 BC, the Athenians of ancient Greece discovered an enormous silver mine right near Athens. The silver extracted from this mine alone paid for the buildin of Athens’ first navy, and helped Athens to become a powerful city-state.

In 1792, silver took on a critical role in the US monetary system when the government adopted a bimetallic monetary standard using both gold and silver. The dollar was fixed to represent 24.75 grains of fine gold or 371.25 grains of fine silver. This standard fixed the value of gold as being 15 times greater than silver. However, this monetary use of silver was discontinued by the US government by 1965. Most other nations have also ceased official silver coinage production for monetary circulation,
with the exception of bullion coins, which are produced for investment buyers.

Today, silver has lost its once dominant role as an important monetary metal and is now valued primarily as an industrial commodity.

Silver Production

Although silver is relatively scarce, it is the most plentiful and least valuable of all the precious metals. Silver is seldom found as a free metal and mostly occur compounded with zinc, copper or lead. Hence, it is mostly produced as a by-product of copper, lead and zinc mining.

Total silver mine production reached 646.1 million ounces in 2006. The largest silver producing countries are Peru, Mexico, China, Australia and Chile.

Platinum Bullion Guide

Platinum is a heavy, relatively malleable, ductile, grey-white metal and is a member of the platinum group of metals. It is a chemical element with the symbol Pt and atomic number 78 in the periodic table. Platinum has a very high melting point, is extremely resistant to corrosion and also an excellent electrical conductor.

While incredibly stable and not reactive by itself, it is excellent in promoting various chemical reactions as a catalyst. Platinum’s role as a catalyst is also the primary reason that makes it such an important industrial metal. 

Platinum is very rare, more rare than gold. All the platinum mined to date can fit in a typical living room. Its rarity, wear and tarnish resistant properties makes platinum the ideal choice for crafting fine jewelry.

Platinum’s many important applications and together with the fact that the metal is extremely rare makes this noble metal the priciest and most valuable of all precious metals. Many people first come into contact with platinum when buying engagement and wedding rings.

History of Platinum

Platinum is the most valuable of all precious metals but it was not always so. When it was discovered by Spanish Conquistadors in the 17th century while panning for gold in the Choco region in what is now Columbia, platinum was considered a nuisance as it interfered with their mining operations. The word platinum comes from the Spanish word platina, meaning “little silver.”

Platinum Production

Due to its unique geological formations, platinum ore is unevenly distributed and concentrations are found only in a couple of places on Earth. As the platinum group metals are usually found together, platinum ores also contain significant amounts of other PGMs such as palladium and rhodium.

The proportions of platinum to palladium in platinum ores can differ significantly, depending on the location of the deposits. The ore in the Stillwater Complex contains a platinum to palladium ratio of 1:3. The South African platinum ores is considerably richer in platinum, having a ratio of platinum to palladium or approximately 2:1.

Traces of platinum can also be found in nickel ores and platinum is also produced as a by-product of nickel mining. Large quantities of platinum is produced in Russia as a result of extensive nickel mining activities in the country.

Approximately 80% of the world’s platinum supply is produced in South Africa and 90% of that coming from the Western Bushveld region. The two main producing countries are South Africa and Russia. Leading mining companies are Anglo Platinum and Impala Platinum, with mines mainly in South Africa.

Leading Platinum Mining Companies

  • Anglo Platinum
  • Impala Platinum
  • Aquarius Platinum

Palladium Bullion Guide

p>Palladium is a hard, silver-white metal and a member of the platinum group of metals. It is a chemical element with the symbol Pd and atomic number 46 in the periodic table. Palladium is usually found alloyed with other metals of the platinum group in platinum ores.

Like platinum, palladium has excellent catalytics properties and are often used as catalyst, such as in catalytic converters on automobiles, organic chemistry, and other coupling reactions. Palladium also has a special affinity for hydrogen and is capable of absorbing up to 900 times its own volume of the gas. This affinity for hydrogen led it to play an essential role in the 1989 Fleischmann-Pons cold fusion experiment.

History of Palladium

A British chemist name W. H. Wollaston, discovered palladium in 1803 when he successfully devised a method to separate palladium from crude platinum ore. He named the new metal after the asteroid “Pallas” which was discovered at around the same time. The name “Pallas”, refers to the Greek goddess of wisdom.

Like the other platinum group metals, palladium’s importance has only increased considerably in the last few decades as a result of rapid technological advancements, which led to new uses for the metal in a variety of industrial applications.

Palladium Production

Palladium is found as a free metal alloyed with gold and other platinum group metals in platinum ore and large quantities of palladium is produced as by-products of platinum and gold mining. The proportions of platinum to palladium in these ores can differ significantly, depending on the location of the deposits. The ore in the Stillwater Complex contains a platinum to palladium ratio of 1:3. The South African platinum ores is considerably richer in platinum, having a ratio of platinum to palladium or approximately 2:1.

Nickel-copper deposits also contain traces of palladium. Although the proportion of palladium in these ores is very low, the enormous volume of nickel-copper ore processed allows for profitable extraction.