Despite a strong start, two European exchange traded funds (ETFs) backed by platinum and palladium, launched in April and May, haven’t generated much excitement. David McKay of MiningMX says that producers of the metals weren’t feeling much enthusiasm for the ETFs because they could create artificial buying and selling pressure.

When metal prices are strong, ETFs backed by platinum can create more demand and tightness in the market. When the prices are weak, the reverse happens. The fears are that that volatility could ultimately hurt the jewelry market.

It’s turning out to be a moot point, since the ETFs aren’t doing much of anything. Despite that, there has been talk of launching a platinum-backed ETF here in the U.S. UK-based precious metals refiner Johnson Matthey says it’s unlikely, at least for the foreseeable future. Analysts say the supplies of platinum and palladium are limited and will inhibit the growth of such an ETF.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.