Differences between Investing vs Trading
Differences between Investing vs Trading
XPTUSD is a commodity pair representing the price of platinum expressed in the US Dollar. Like other precious metals like gold and silver, platinum is an investment commodity used as a portfolio hedge. The USD is the number one most traded currency in the world. Platinum has physical uses, too, primarily in the jewellery, industrial, and automotive sectors.
Platinum is traded on global commodities markets and is considered the most volatile precious metal. It is also more rare and durable than gold. Today, most of the world’s platinum production is mined in South Africa, followed by Russia. In China, 50% of the mined platinum goes into jewellery.
A range of external factors affects the platinum price, so investors need to monitor economic and financial news relating to the commodity.
Since the 2007/2008 financial crisis, the platinum price has trended lower due to growing interest in other metals. Regulations and negative news surrounding major platinum-producing countries like Russia, South Africa, and China also impact the XPTUSD share price.
As with any commodity, there are different ways traders and investors can get involved in the platinum market. Traders have the option to buy and sell platinum futures and use them as a hedging tool. Traders can also open a contract for difference (CFD) trading account to speculate on the platinum price.
Because the platinum and commodity market is volatile and heavily influenced by external factors, commodity CFD trading is advantageous because you can benefit from both falling prices and increasing prices. Other than commodities, you can also use CFD trading accounts to trade other instruments like shares, forex, and indices.
Investors can buy exchange-traded funds (ETFs) that specialise in platinum. These ETFs can either focus on investing in one single commodity held in physical storage or commodities futures contracts.
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* The spreads provided are a reflection of the time-weighted average. Though Skilling attempts to provide competitive spreads during all trading hours, clients should note that these may vary and are susceptible to underlying market conditions. The above is provided for indicative purposes only. Clients are advised to check important news announcements on our Economic Calendar, which may result in the widening of spreads, amongst other instances.
The above spreads are applicable under normal trading conditions. Skilling has the right to amend the above spreads according to market conditions as per the 'Terms and Conditions'.
What affects Platinum prices?
Platinum prices can be greatly affected by different market events. When it comes to supply and demand dynamics, increased industrial use of the metal or restrictions on its production, such as those placed in South Africa where most platinum is mined, can drive up prices. The introduction of new technologies that make platinum more accessible to the public may also raise its price.
On the other hand, if global economic growth slows or investors become less interested in precious metals, platinum prices may drop accordingly. It's important to keep an eye on current market events and news stories, as they can indicate how platinum prices are likely to move. By closely monitoring these developments and understanding their implications, traders can stay ahead of the game and make informed decisions regarding investing in platinum.
How to trade Platinum CFD
It's important to understand the risks that come with trading Platinum CFDs. As a precious metal, its price can be subject to manipulation by large financial institutions or governments – so, it's important to keep an eye on how economic and political events may affect Platinum prices. Additionally, there is always the risk of loss when investing in CFDs due to leverage and the possibility of market conditions changing unexpectedly.
For traders looking to benefit from Platinum CFD trading, it's important to have a good understanding of how the markets work and the risks associated with them. By having this knowledge, you'll be better equipped to make informed decisions about when and how to invest in Platinum CFDs. With careful research and analysis, you should be able to maximize your returns while minimizing your risks. Good luck!
What are the other options for trading Platinum?
In addition to trading Platinum commodities, there are a few major miners who offer exposure to the metal. Vale SA is one of the largest diversified mining companies in the world and is a significant producer of Platinum ore. Hecla Mining is another option for traders looking for access to Platinum, as well as silver and gold production. Finally, Newmont Mining is a major producer of Platinum and has extensive operations around the world. Any of these miners could be an attractive way to gain exposure to the price movements of Platinum.
Why Trade [[data.name]]
Make the most of price fluctuations - no matter what direction the price swings and without the restrictions that come with owning the underlying asset.