The post Best Metals to Invest In by Sarah Harris appeared first on Benzinga. Visit Benzinga to get more great content like this.
Whether you’re a novice investor or a seasoned financier, diversifying your investment portfolio is a wise move.
One avenue that has stood the test of time for centuries is investing in metals. But which are the best metals to invest in?
Gold is the first that comes to mind because of its rarity and aesthetic appeal, but metals offer many other options. This article will take you through the top five best metals to invest in to help you decide which to add to your investment portfolio.
Table of contents
[Show]
5 Best Metals to Invest In
Benzinga explores two categories of metals: precious metals and industrial metals. Investors throughout the centuries have been buying precious metals like gold and silver, but investments in industrial metals like copper can also be profitable.
1. Gold
Investing in gold is a strategic move that can help you safeguard your wealth despite economic uncertainties. Gold has been valued for millennia, and its worth as an investment continues to shine.
The price of gold tends to rise during economic downturns, which is why gold can provide an effective hedge against inflation. Since gold is a tangible asset, it also offers investors a heightened sense of security.
Pros
- Retains value even during inflation
- Consistent global demand
- Provides portfolio diversification, which reduces overall risk
Cons
- Requires secure storage, which can be costly
- Doesn’t generate dividends or interest, unlike stocks and bonds
- Slower and more cumbersome sales process
2. Silver
Many have referred to silver as poor man’s gold, but this nickname doesn’t do justice to how beneficial it can be to add silver to your portfolio.
Silver’s value comes partially from its rarity, but it is also used extensively in industrial applications, like medical devices, electronics and solar panels. These unique attributes as both a precious and industrial metal mean that silver’s value can benefit from economic growth and serve as a hedge during economic downturns.
Pros
- More affordable than gold and thus accessible to a wider range of investors
- High industrial demand, which makes it a stronger investment
- More volatile price than gold, which means it can offer higher returns in certain markets compared to gold
Cons
- May not be a suitable option for risk-averse investors
- More sensitive to economic downturns
- Potentially higher returns with other investments
3. Rhodium
Rhodium is a lesser-known precious metal that is rarer than gold or platinum. It’s generally used in the automotive industry in objects like catalytic converters, where it helps reduce harmful emissions.
Investing in rhodium is an unconventional way to diversify your portfolio with a high-value metal that has major industrial demand. But if you’re going to invest in this metal, it’s important to note that because of its rarity and specialized use, it can be a riskier option than traditional precious metals like silver and gold.
Pros
- Extremely rare, which can drive up its value
- Has experienced significant price increases in the past, which could indicate higher returns for investors
- High industrial demand, which could make it a stable investment opportunity
Cons
- Volatile and unpredictable price
- Higher entry costs compared to other metals like silver and gold
- Less-developed market, which impedes the buying and selling process
4. Platinum
Platinum is a precious white metal with unique properties, like exceptional conductivity and a high melting point. It is used in many industries, from jewelry making to specialized chemical uses to medical device manufacturing.
In addition, platinum is a key component in creating fuel cells, which are used for clean energy applications. As the world’s largest economies transition to cleaner energy, the demand for platinum could rise significantly.
Pros
- High prices from supply constraints
- High future demand could make platinum a wise investment now
- An increasing number of platinum-based investment products may indicate growth
Cons
- Price volatility from constraints on supply and extraction
- Much of the platinum in use is recycled, which can have an impact on supply constraints
- Heavily diesel-dependent, with declining diesel vehicle demand
5. Copper
Copper is an industrial metal used in a variety of applications, from construction to electrical wiring and electronics. The demand for copper is surging because of a global shift toward renewable energy and electric vehicles.
Investing in copper could be a strategic move at this point, especially if you want to capitalize on global infrastructure development and the green energy revolution.
Pros
- Copper prices tend to reflect the health of the economy, so investing in copper can be a good way to bet on economic growth
- Demand for copper is on the rise as developing countries are investing in building infrastructure
- The demand for copper is unlikely to cease because of its excellent electrical conductivity properties
Cons
- A downturn in the economy can have an impact on demand and prices for copper
- Copper is susceptible to being replaced by aluminum if there’s not enough supply
- Storing and handling physical copper investments can be inconvenient and costly
Are Metals a Good Investment?
Metals, especially precious ones, tend to be good investments, especially in times of economic uncertainty. Their intrinsic value does not tend to diminish over time, unlike less tangible assets.
However, like other investments, metals come with their own risks. Precious metals like gold and silver may be less likely to lose value, but their prices can be volatile in the short term. Industrial metals like copper are highly dependent on economic activity.
When you devise an investment strategy, you should consider how investing in metals can support diversification. You might also consider a combination of precious and industrial metal investments to help mitigate risks.
Precious metals don’t have interest rates, unlike bonds or savings accounts. When you’re investing in physical precious metals, you’re buying a tangible asset — one whose value is vulnerable to market forces.
But even though metals don’t pay interest or dividends, interest rates can still indirectly affect metal prices. When interest rates are high for other investments, the demand for assets like precious and industrial metals tends to increase.
Invest in Metals with These Top Online Brokers
If you’re ready to add metals to your investment portfolio, the first step is to explore top online brokers. Online brokers offer an accessible and efficient way for you to discover the best metals to invest in without accounting for physical storage for your metals.
Claim Exclusive Offers
get started
securely through Interactive Broker Primary’s
website
Interactive Brokers is a comprehensive trading platform that gives you access to a massive range of securities at affordable prices. You can buy assets from all around the world from the comfort of your home or office with access to over 150 global markets. Options, futures, forex and fund trading are also available, and most traders won’t pay a commission on any purchase or sale.
IBKR is geared primarily toward experienced traders and investors but now with the availability of free trades with IBKR Lite, casual traders can also acclimate to IBKR’s offerings.
Best For
- Access to international markets
- Active traders
- Detailed mobile app that makes trading simple
- Wide range of available account types and tradeable assets
- IB SmartRouting provides significant price improvement vs. industry
- Fractional trading allows investing regardless of share price
- Industry’s lowest margin rates
- Earn more by lending your fuly-paid shares
- Beginner investors might prefer a broker that offers a bit more hand-holding and educational resources
Get 10 Free Shares
securely through Magnifi’s
website
Magnifi is an intelligently designed marketplace that allows investors to access data-backed information about various investment opportunities. The company combines standard brokerage tools with artificial intelligence (AI) to promote financial competence. Magnifi distinguishes itself from the crowd by offering an AI-powered search feature and an AI-powered investment assistant. Magnifi offers a technology-forward platform that aims to promote confident and capable long-term financial investments.
Best For
- Long-term investors
- Individuals interested in personalized assistance
- New investors that are eager to learn how to start investing
- Access to an AI-powered investing assistant with a Magnifi Personal account
- Commission-free investing
- Over 15,000 possible investments
- Available mobile application
- Limited methods of communication with customer service
get started
securely through CenterPoint Securities’s
website
CenterPoint Securities is ideal for active traders who demand access to advanced tools and services. While investors and casual traders are likely to be content with the basic offerings of traditional online brokerages, active traders will benefit from CenterPoint’s suite of advanced trading tools. If you value execution quality, access to short inventory, advanced trading platforms, and accessible customer service, CenterPoint is an excellent choice.
Best For
- Intermediate to Advanced traders
- High-volume traders
- Momentum traders
- Short sellers
- Unrivaled access to short inventory
- Flexible order routing for improved executions
- Discounts for active traders
- Advanced platform with fast executions
- Reliable customer service
- Not designed for beginner or low-volume traders
get started
securely through Webull’s
website
Webull, founded in 2017, is a mobile app-based brokerage that features commission-free stock and exchange-traded fund (ETF) trading. It’s regulated by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).
Webull offers active traders technical indicators, economic calendars, ratings from research agencies, margin trading and short-selling. Webull’s trading platform is designed for intermediate and experienced traders, although beginning traders can also benefit.
Webull is widely considered one of the best Robinhood alternatives.
Best For
- Active traders
- Intermediate traders
- Advanced traders
- No account maintenance fees or software platform fees
- No charges to open and maintain an account
- Intuitive trading platform with technical and fundamental analysis tools
- Does not support trading in mutual funds, bonds or OTC stocks
get started
securely through TD Ameritrade’s
website
This publicly listed discount broker, which is in existence for over four decades, is service-intensive, offering intuitive and powerful investment tools. Especially, with equity investing, a flat fee is charged, with the firm claiming that it charges no trade minimum, no data fees, and no platform fees. Though it is pricier than many other discount brokers, what tilts the scales in its favor is its well-rounded service offerings and the quality and value it offers its clients.
Best For
- Novice investors
- Retirement savers
- Day traders
- World-class trading platforms
- Detailed research reports and Education Center
- Assets ranging from stocks and ETFs to derivatives like futures and options
- Thinkorswim can be overwhelming to inexperienced traders
- Derivatives trading more costly than some competitors
- Expensive margin rates
Best Metals to Invest In? It Depends on Your Goals
Investing in metals can be a lucrative venture that stabilizes your overall portfolio. The types of metals you should invest in will depend on your goals and your risk appetite. Whether you’re drawn to gold or copper, understanding the market of precious and industrial metals and diversifying your investments is key to being a savvy investor.
Frequently Asked Questions
What metal holds value the most?
Historically, gold has held its value the most, making it one of the best precious metals you could invest in. Other precious metals may be more volatile, but they are still considered to be good hedges against inflation.
Answer Link
What metal doesn’t lose value?
Precious metals like gold and silver tend to be less likely to lose value over the long term.
Answer Link
Is it better to invest in gold or platinum?
Both gold and platinum have their merits, so it really depends on your goals and risk appetite. Gold tends to be a safer investment, while platinum has the potential for higher industrial demand.
Answer Link
The post Best Metals to Invest In by Sarah Harris appeared first on Benzinga. Visit Benzinga to get more great content like this.