SOME­THING TO KEEP IN MIND

Finweek English Edition - - INVESTMENT -

The two pal­la­dium ETFs (NGPLD and ETFPLD) have been a roar­ing suc­cess. Both have a mar­ket cap of around R3.7bn and rep­re­sent some 420 000 ounces of pal­la­dium each. Global mined pal­la­dium pro­duc­tion is around 6m-7m ounces per year, mean- ing that these two ETFs have taken more than 10% of a sin­gle year’s pro­duc­tion out of the mar­ket. In a sense this helps de­mand and hence mov­ing prices higher. This is all well and good, and cer­tainly the plat­inum and gold ETFs did pretty much the same, al­beit on dif­fer­ent scales. But they also add to price risk when the sell­ing starts. It is not likely to hap­pen any­time soon, but al­ways re­mem­ber that what can boost a price can just as well dent it in time.

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