April 19, 2008 at 1:00 am by Tom Lydon
Platinum is projected to maintain a supply deficit this year, and one way for investors to benefit is with exchange traded notes (ETNs).
There is currently a deficit of 360,800 ounces this year, and it’s an improvement over the 412,400 ounce deficit in 2007. Mine supply is set to continue to fall in the wake of the South African power crisis, and as long as the shortage is in place, prices will remain high. Two-thirds of the world’s platinum supply hails from South Africa. The major mines are still limited to 90% power.
Jon A. Nones for Resource Investor reports that platinum futures for July delivery are set at $2,034.90 per ounce. The record was set in March at $2,308.80.
There is yet to be a pure platinum ETF, however, the Elements MLCX Precious Metals Index (PMY) exchange traded note follows a benchmark of precious metals, including platinum.
The reason there is no platinum ETF is because there is such a shortage of the metal that it isn’t very liquid.
Tags | ETNs, Material ETFs, Metals, Platinum, South Africa
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