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Platinum – More uncertainty than opportunity

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7 år sedan

den

9 januari, 2018

Accelerating growth in the European auto sector should offset the gradual decline in diesel cars market share, supporting platinum’s demand. Platinum – More uncertainty than opportunity.

Palladium’s outperformance is tied to a confluence of reasons – the ‘Dieselgate’ scandal, strong auto demand and speculative buying interest. However this is unsustainable.
Accelerating growth in the European auto sector should offset the gradual decline in diesel cars market share, supporting platinum’s demand. Platinum – More uncertainty than opportunity.

Platinum’s sustainable long term price recovery is rooted in meaningful production cuts.
Palladium has rallied 43% in 2017, marking the strongest performance within the commodity complex. It has surpassed its counterpart platinum for the first time in 16 years. The price movement of platinum and palladium has historically been in sync since the majority of their use is derived by catalytic converters used in gasoline and diesel vehicles respectively.

Net Balance vs Ratio

The last time we witnessed a similar price outperformance by palladium was in 2000, triggered by supply disruptions in Russia. While the Russian government’s threat to stop selling palladium never materialised, it certainly prompted a fear of a supply deficit amplifying palladium’s price surge. It’s worth noting that consequently palladium underperformed platinum for more than eight consecutive years.

‘Dieselgate’ lifted palladium higher

Demand for platinum suffered a setback after the emissions scandal sparked by Volkswagen two years ago dented investor sentiment towards the precious metal. Data from the European Automobile Manufacturers Association (ACEA) has revealed in H1 2017 that sales of gasoline powered cars in Europe surpassed diesel powered cars for the first time since 2009. The share of diesel cars declined by 3.8% YTD (year-to-date) while gasoline cars rose by 10% YTD. In France, gasoline cars are currently dominating market share contrary to its historical 70% ownership of diesel cars. In addition the rising demand for relatively larger gasoline cars, which contain larger motors, combined with stricter emission standards has increased the loading requirements of palladium. This shift in consumer preferences in size and category of cars had a strong role to play in the recent divergence of performance between the two precious metals. That being said, auto sales in US and China, known for driving gasoline cars are softening and its effect could limit palladium’s upside in the near term.

Global auto sales growth

European auto demand bullish for platinum

Auto sales in Europe (dominated by diesel cars) are gaining momentum. Since the decline in diesel market share will be a gradual ongoing process, platinum demand will remain well supported. In addition as new emission standards in Europe intensify, platinum’s price recovery over the medium term remains well supported.

Platinum is known to be about twice as effective as palladium in catalytic convertors. The potential for substitution between the two precious metals is reliant on whether fabricators perceive platinum’s current price discount to palladium to persist for a substantial period. Furthermore supply shortage concerns of palladium (deficit predicted in 2018) in the long term could also be a cause for substitution away from palladium. Speculative interest unlikely to last

Palladium’s outperformance to a large extent can be attributed to speculative buying interest encouraged by the bullish backdrop for palladium. The first week of June witnessed a surge in the lease rate to borrow palladium from 3.5% to 16%, underscoring the shortage of palladium in the market. There is evidence that the strong buying interest from Asia overwhelmed the relatively small market. The palladium market is the smallest and least liquid market among the four tradable precious metals and remains vulnerable to sharp price swings caused by sudden speculative flow of money.

Palladium Imports vs Inventory

The forward curve of precious metals generally tends to be in contango (future price higher than current price). However palladium’s forward curve has been in backwardation for almost nine months, illustrating the tightness in the market. While contango is the cost of holding a commodity, backwardation is a benefit.

That being said, the slope of the backwardated palladium curve is allowing speculators to buy the lower priced forward contracts and roll up the price curve into the higher spot prices. This has allowed them to lock in a positive roll, which has been extremely attractive in the current low yielding environment. Owing to this, the bulk of demand for palladium is in the present, and that optimism is waning looking forward.

Platinum’s deep discounts support demand

While platinum has historically traded at a significant premium over gold, it’s currently trading at a -28% discount to gold. Platinum is highly correlated to gold, however in this cycle it has only tracked gold’s downward movements and captured very little of the upside. We believe this recent trend could be broken and traditional correlations restored if consumers recognise just how cheap platinum is right now. We expect price sensitive jewellery consumers to switch to the relatively cheap platinum especially as it is gaining further acceptance in key markets like China and India. Given a supportive backdrop of improving economic conditions globally combined with platinum’s relative price attractiveness, we expect demand for platinum to rise. We expect most of the growth to be concentrated in industrial applications – chemicals, glass and electrical (the second largest component at 20% of platinum consumption).

Platinum investment demand is strong

Out of the precious metals, physically-backed platinum ETPs have acquired the highest assets under management since 2012. While palladium has accumulated the least. Platinum’s relative price advantage and lower volatility will be the primary stimulus for the investment sector. Platinum holdings stands to benefit a portfolio by providing protection against inflation and financial asset deflation, while allowing positive upside as industrial demand recovers globally.

Physically backed ETPs

Platinum’s upside tied to supply cuts

Platinum producers in South Africa (known to account for 80% of global output) are struggling, as lower platinum prices and higher fixed costs coupled with weak demand from key segments are straining margins. So far, the miners have not meaningfully reduced production. Efforts to spread fixed costs over a wider output base have resulted in an oversupply. However this is unsustainable. Platinum miner Sibanye recently backed out from its announcement to shutter shafts worth 300koz at its Rustenburg site. Sibanye’s reluctance to shutter mines is illustrative of the unwillingness of producers to make meaningful supply cuts to stimulate prices.

Electric vehicle growth in nascent stage

Demand for electric vehicles (EVs) have been the focal point of future risks facing the platinum and palladium industry. While the auto industry is undergoing a structural shift, away from the internal combustion engine towards battery electric vehicles (BEVs). The reality is the uptake of sales of EVs is likely to be gradual. The reason behind this is the necessary infrastructure – development of batteries and charging stations to facilitate this shift will require a longer time frame than anticipated. China recently announced its intention to delay the enactment of the quota requiring automakers to produce a minimum number of EVs. Consumer acceptance of EVs hinge on extensive public subsidies.

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Liknande ämnen:ETF Securities palladium Platinum

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April in ETFs: Gold at New Highs, Crypto in Transition, and Moat Index Holding Steady

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4 timmar sedan

den

2 maj, 2025

Redaktionen

As April winds down, markets remain on edge, with escalating tariffs and renewed trade tensions keeping volatility in focus. In this summary of our full-length newsletter, we spotlight gold and gold equities, both of which have surged to record levels. We also take a step back from the day-to-day noise in crypto to explore the broader shifts in the regulatory landscape in our latest Whitepaper and present Celestia in detail. Finally, we assess how Moat indexes have held up and evolved amid the turbulence.

Your VanEck Europe team wishes you a great read.

🥇 Are Gold Mining Equities Regaining Attention Amid Rising Gold Prices?

Gold & Gold mining equities tend to shine during stress periods

Source: VanEck, World Gold Council.

Gold has attracted renewed interest from investors amid concerns about inflation, currency volatility, and overall market uncertainty. Gold mining companies have recently reported improved profit margins and cash generation, with some initiating share buybacks and maintaining relatively strong balance sheets. Despite these developments, many continue to trade below their historical valuation averages.

While historical trends indicate that gold and gold mining equities have outperformed during certain periods of market stress, these patterns may not repeat under different economic conditions. Performance can be influenced by a range of factors including interest rates, central bank policy, geopolitical developments, and investor sentiment.

→ Read more

⚖️ Whitepaper Highlights: How New Crypto Regulations May Shape the Future

Cryptocurrencies are entering a new era. With the re-election of Donald Trump and the implementation of the European Union’s Markets in Crypto-Assets (MiCA) regulation, digital assets are moving into a landscape defined not just by innovation, but also by regulatory clarity.

MiCA’s structured and transparent approach aims to promote legitimacy, safeguard investors, and enhance trust in digital asset markets across Europe. It could also serve as a blueprint for other jurisdictions looking to regulate crypto effectively.

→ Read the Whitepaper Highlights

⛓️ Introduction to Celestia

Most blockchains, like Ethereum or Bitcoin, are monolithic which means they perform all major functions (consensus, data availability, and execution) on a single layer. This design ensures security but according to new modular networks, limits scalability and flexibility.

The modular blockchain thesis, which Celestia is leading, proposes separation of layers and respective responsibilities in the network.

→ Read more

Note: This article in not accessible to our UK readers.

🌊 Riding the Gold Wave

Chasing the Vein: Fund Flows into Gold Miners

Source: Mining.com. Data as of 21 March 2025. Note: Data covers 493 funds with combined assets under management of $62 billion.

U.S. equity markets experienced significant declines during the month of March. Meanwhile, spot gold price recorded new all-time highs, surpassing the $3,000 per ounce mark on 14 March and closing at a record price of $3123.57 on March 31, a 9.30% ($265.73) monthly gain. As of 31 March, gold prices have risen by 93.61% over the past five years (1). Investors should keep in mind that past performance is not representative of future results.

The gold miners, as represented by the NYSE Arca Gold Miners Index (GDMNTR), outperformed significantly, up 15.51% during March (2). This gain reflects both their operational leverage to rising gold prices and market perceptions of relative value. However, gold miners can also be subject to heightened volatility, operational risks, and sensitivity to commodity price swings.

While gold and gold equities may serve as diversifiers in a portfolio due to their historically low correlations with many asset classes, investors should remain mindful of the inherent risks, including price volatility, currency movements, and shifts in investor sentiment that can lead to rapid reversals in performance.

→ Read more

🌪️ Moat Stocks Weather Tariff Tumble

Market turbulence in March weighed on stocks. The Moat Index was not immune to the market turmoil, as it declined along with the broad U.S. equity market ending the month lower. However, the Moat Index showed resilience relative to the S&P 500—thanks in part to defensive sector resilience and underweight exposure to mega-caps.

At the same time, the SMID Moat Index lagged small and mid-caps in March. Smaller U.S. stocks were also impacted by global trade tensions and economic growth concerns with the broad small- and mid-cap benchmarks falling during the month. However, year-to-date, the SMID Moat Index remains ahead of the broader small- and mid-cap markets.

→ Read more

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To receive the full version, sign up here.

(1) Source: World Gold Council, ICE Data Services, FactSet Research Systems Inc.

(2) Source: Financial Times.

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BBVAE ETF är en spansk ETF som spårar Eurostoxx 50

Publicerad

5 timmar sedan

den

2 maj, 2025

Redaktionen

BBVA Acción Eurostoxx 50 ETF FI Cotizado Armonizado (BBVAE ETF) med ISIN ES0105321030, strävar efter att spåra EURO STOXX® 50-index. EURO STOXX® 50-indexet följer de 50 största företagen i euroområdet.

Den börshandlade fondens TER (total cost ratio) uppgår till 0,20 % p.a. ETFen replikerar resultatet av det underliggande indexet genom full replikering (köper alla indexbeståndsdelar). Utdelningarna i ETFen delas ut till investerarna (halvårsvis).

BBVA Acción Eurostoxx 50 ETF FI Cotizado Armonizado har tillgångar på 133 miljoner euro under förvaltning. Denna ETF lanserades den 3 oktober 2006 och har sin hemvist i Spanien.

Beskrivning BBVA Acción Eurostoxx 50 ETF FI Cotizado Armonizado

Med BBVA Acción Eurostoxx 50 ETF FI Cotizado Armonizado deltar investerare i ökningen av värdet på aktierna i de 50 största konglomeraten i euroområdet (euroområdet). Euro Stoxx 50-indexet inkluderar aktier från 8 länder i euroområdet: Belgien, Finland, Frankrike, Tyskland, Irland, Italien, Nederländerna och Spanien.

Handla BBVAE ETF

BBVA Acción Eurostoxx 50 ETF FI Cotizado Armonizado (BBVAE ETF) är en börshandlad fond (ETF) som handlas på Bolsa de Madrid.

Bolsa de Madrid är en marknad som få svenska banker och nätmäklare erbjuder access till, men DEGIRO gör det.

Börsnoteringar

Börs	Valuta	Kortnamn
Bolsa de Madrid	EUR	BBVAE

Största innehav

Värdepapper	Vikt %
ASML Holding NVNL0010273215	8,59%
Lvmh Moet Hennessy Louis Vuitton SEFR0000121014	5,60%
SAP SEDE0007164600	5,16%
TotalEnergies SEFR0000120271	4,59%
Siemens AGDE0007236101	3,70%
Schneider Electric SEFR0000121972	3,46%
Future on Euro Stoxx 50	3,02%
Sanofi SAFR0000120578	2,99%
L’Oreal SAFR0000120321	2,98%
Allianz SEDE0008404005	2,93%

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The Art of Meme-ing: How Dogecoin Redefined Value

Publicerad

6 timmar sedan

den

2 maj, 2025

Redaktionen

Explore Dogecoin’s impact on crypto, turning internet memes into cultural and financial assets.

𝕋𝕚𝕞𝕖 ℂ𝕠𝕕𝕖𝕤:

00:00 – Intro

00:27 – Where do Memes come from?

03:13 – What are some of the first Memes you remember?

10:28 – Do these things have value?

14:04 – The different types of cryptocurrencies

17:20 – How did Dogecoin start?

24:26 – What is some of the utility?

28:36 – How does it fit into the portfolio?

30:38 – Final thoughts

Research Newsletter

Each week the 21Shares Research team will publish our data-driven insights into the crypto asset world through this newsletter. Please direct any comments, questions, and words of feedback to research@21shares.com

Disclaimer

The information provided does not constitute a prospectus or other offering material and does not contain or constitute an offer to sell or a solicitation of any offer to buy securities in any jurisdiction. Some of the information published herein may contain forward-looking statements. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties and that actual results may differ materially from those in the forward-looking statements as a result of various factors. The information contained herein may not be considered as economic, legal, tax or other advice and users are cautioned to base investment decisions or other decisions solely on the content hereof.

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