With economic uncertainty in 2020, many investors turned to precious metals like platinum and gold as safe haven assets. By comparing platinum and gold price charts in 2020, platinum significantly outperformed gold in terms of returns while experiencing lower volatility. This article analyzes platinum vs gold investment in 2020 and provides suggestions for investing in precious metals.
Platinum prices increased over 10% while gold prices were flat in 2020
According to historical price charts, platinum prices started 2020 around $970 per ounce but increased to over $1,070 by the end of the year, a 10%+ gain. In comparison, gold prices were around $1,520 per ounce in January 2020 and closed the year around $1,900 for a 25% increase. However, gold prices were extremely volatile through 2020 ranging from $1,450 to $2,075 while platinum prices moved in a tighter trading range. For investors looking for solid returns with lower risk, platinum significantly outperformed gold in 2020.
Investor optimism boosted platinum while economic uncertainty lifted gold in 2020
The divergent performance between platinum and gold can be attributed investor sentiment and economic conditions in 2020. Optimism about emerging technologies like fuel cells for electric vehicles increased demand for platinum used in catalytic converters and boosted prices higher. On the other hand, gold prices surged early when the COVID pandemic caused extreme stock market volatility and recession fears. Yet many economic metrics and consumer spending recovered strongly since Q2, reducing safe haven buying in gold and leading to the consolidation. For conservative investors, platinum provided quality returns without the huge volatility swings experienced in the gold market.
In conclusion, platinum significantly outpaced and outperformed gold in 2020 by providing over 10% returns compared to a 25% gain for gold. Moreover, platinum prices were far less volatile than gold prices which fluctuated in a wide $600 trading range throughout 2020. For investors considering precious metals, platinum deserved more attention and may continue to shine brighter than gold moving forward.