The fundamentals of precious metals – a broad introduction
to the basic principles
Information about gold, silver, platinum, palladium and other elements
The designation of particular metallic substances as precious metals is due to their unique resistance to corrosion. Gold and silver in particular owe their use for jewellery, and for coins as a medium of exchange, since ancient times to this renowned stability. In the periodic table of the elements, a total of eight metals are classified as belonging to the category of noble metals. Gold, silver, platinum and palladium in particular are of crucial importance for world markets. While gold is considered a pure luxury product with a high value density, silver and platinum metals are also used in many industrial sectors. In addition, trading in precious metals has been a successful part of the investment sector for more than 70 years.
Looking at this particular category, our extensive collection of articles will inform you about the basics of precious metals. Find out where they are extracted and processed, the formats in which they are traded, and why they are so often recommended as investment products. You can also read interesting facts about the history of various gold standards, how precious metal prices are determined, and how their values can be calculated and compared. Click on each link to find out more about the respective topic:
The most well-known precious metals include gold and silver. However, platinum metals and copper also play important roles from the point of view of investors and industrial users. Due to their high value density and their limited occurrence in the earth’s crust, physical precious metals are often recommended as a store of value, and for diversifying investment capital. Coins, bars and granules are used for this purpose.
Although Switzerland also has its own natural gold deposits, the country plays a more important role in the international gold trade as the world’s largest gold importer. Some of the busiest refineries operate here. This also includes Zurich as a major stock exchange and global financial centre. Investors can buy gold in Switzerland and store it safely.
Gold, silver and other ores are mined in China, Australia, USA, South Africa and Mexico. They are further processed in large precious metal refineries. Five of the most important refining companies in the world are located in Switzerland. In addition to jewellery and the automotive industry, investment products and medical devices are the most important areas where precious metals are used.
An estimated 200,000 tons of gold have been mined by human hands – a quantity still in existence. It is still mined today in China, Australia, Russia, Canada and the USA. Nevertheless, five of the largest European gold refineries are located in Switzerland. Widespread forms of gold investments include gold bars, and gold coins such as Krugerrands, Nuggets or Kangaroos, and Chinese Pandas.
Gold is characterized by its high value density and its reassuring properties as a store of value and crisis metal. Gold coins, gold bars or gold granules are all suitable investment products. Investors can purchase this precious metal direct from specialist Swiss retailers and should pay careful attention to its authenticity and fineness rating. Privately run, bank-independent storage companies such as Swiss Gold Safe are recommended for gold storage.
In its coin format, silver is one of the oldest methods of payment in the world. But where are the largest silver deposits on earth, and how are they extracted? In addition to gold products, this particular white metal is now the most important form of investment. Private investors also value silver coins and bars for wealth accumulation, and for crisis protection. What are the advantages and disadvantages of silver investment products?
Platinum is characterized by its high material density and has exceptional corrosion resistance. Thus, it is mainly used in the automotive industry, but also in jewellery making and medical devices, and of course as a popular investment product due to its value density. The major deposits of pure platinum are found in South Africa. It is also obtained as a by-product of copper and nickel mining.
The grey precious metal palladium is one of the platinum metals and is now a coveted raw material for the automotive industry. It trades at higher prices than gold. Palladium production takes place mainly in Russia and South Africa. As an investment product, palladium is considered more of an exotic product with a limited selection of options. The best-known palladium coin for investors is the Maple Leaf from Canada.
The rare earths of the periodic table are mainly extracted from the earth’s crust in China, the USA or Australia. Their main areas of application are automotive engineering, wind energy and other high-tech environments. Strategic metals such as dysprosium, neodymium, praseodymium or terbium are also suitable as investment products. However, professional storage is important for their value retention.
Cryptocurrencies are a welcome alternative to other investment products. But what is the substance behind digital money, how can it be used, and what advantages and disadvantages does it offer? Our post discusses the most common crypto assets and how to acquire them. We also highlight the important differences between bitcoin, altcoin and fiat money.
The gold to silver ratio compares the price of gold to the price of silver. This value determines how many ounces of silver it takes to purchase a single ounce of gold. Investors can thus see at a glance whether the white metal is overvalued or undervalued. This article sheds light on the historical development of this metric and shows how the calculation works, using examples. A sub-theme is bimetallism, which refers to times when the exchange rate between gold and silver was fixed.
The stock-to-flow ratio calculates the ratio of raw materials already mined to their current annual production. It is used, for example, to value gold, because simply looking at its supply and demand is not a transparent means of assessing the value of this yellow metal. Gold is almost indestructible, but the cost of production is increasing. Also read how gold compares to the crypto asset Bitcoin.
The price of gold, silver and other precious metals is set daily on the international London Bullion Market – also known as the gold fixing (gold fix) or silver fixing (silver fix). In addition, the London Bullion Market Association (LBMA) defines the standard for Good Delivery bars, which guarantees consistent precious metal quality. This same organisation also lists all LBMA-certified bar manufacturers.
Comex is short for Commodities Exchange and is the largest marketplace for commodity futures trading. This article explains the connection with futures contracts and the importance of the First Notice Day. It describes the requirements for the delivery of qualified and registered gold, and among other things, explains the difference between the spot market and the futures market.
This article provides you with a comprehensive analysis of the different stages of the development of the international monetary system. Learn about the historic importance of gold and silver coins, and what systems were in place in Europe and around the world at different times. The fiat standard has been in use since 1971 – and national currencies have not been backed by gold since then.
In 1865, some European countries founded the Latin Monetary Union – a bimetallic silver-gold standard designed to unify different national currencies. The denominations and the gold and silver content were thus identical. As a result, world trade and tourism flourished. However, the fixed exchange ratio between gold and silver proved to be complicated.