Platinum as an investment 2025: Renaissance or temporary hype?

After a long period in the shadow of gold and silver, platinum is experiencing a remarkable resurgence in 2025. With an increase from nearly $900 in January to about $1,450 in July 2025 – a gain of over 50 percent – many retail investors are asking: Has platinum finally become an attractive investment again?

Why Platinum Was Underestimated for a Long Time

The answer lies in recent price developments. While the gold price has been reaching new all-time highs since 2019 and surpassed the $3,500 mark in April 2025, platinum remained around the $1,000 level for a long time. The phenomenon of a negatively trending platinum-gold ratio – ongoing since 2011 – is unprecedented in the price history of these two precious metals.

The primary reason for this weakness was stagnating demand from the automotive industry. Platinum is mainly used in diesel catalysts, whose importance has significantly declined in recent years. This structural headwind overshadowed all other positive factors – until now.

The Perfect Storm Scenario for Platinum Prices

The current rally is explained by an unusual combination of several factors:

Supply-side under pressure: South Africa, the world’s largest platinum producer, is struggling with serious production problems. At the same time, only about a 1 percent increase in supply is expected for 2025 – amid structural capacity limits that make rapid growth nearly impossible.

Demand remains surprisingly resilient: While industry activity slows down, China and the jewelry sector are showing much more stability than predicted. Total demand for 2025 is estimated at 7,863 koz, while supply is expected to reach only 7,324 koz – a structural deficit of 539 koz.

Monetary conditions: The weak US dollar makes platinum more attractive to international buyers, while geopolitical tensions bring traditional safe-haven metals back into focus.

Investment momentum: Large ETF inflows and speculation on a long-term scarcity further fuel the prices.

Platinum as an Investment: Different Approaches

Investors have several options, from conservative to speculative:

Physical purchase remains the classic model. Coins, bars, or jewelry are available from precious metal dealers but require secure storage and incur storage costs.

ETCs and ETFs offer straightforward access without storage effort. These instruments mirror price movements and can be flexibly integrated into existing portfolios.

Mining stocks provide indirect platinum exposure with additional profit potential or risks through operational management.

Leveraged instruments like CFDs are aimed at experienced traders. With a small capital outlay, large positions can be built – CFDs allow investing in commodities starting from just 1 EUR. Leverage can multiply gains but also amplifies losses.

Platinum as a Portfolio Hedge: Potential and Volatility

For long-term investors, platinum offers an interesting aspect: its supply and demand dynamics differ significantly from stocks and bonds. During economic downturns, it can serve as a diversifier, while in upswings, it benefits from increased industrial demand.

However, this volatility also entails risks. The increased price fluctuations compared to gold or silver require careful portfolio weighting. A share of 3–7 percent as an addition is appropriate for many investors but should be adjusted based on individual risk profiles.

The Historical Perspective: From Rarity to Industrial Mass

Interestingly, platinum was once more valuable than gold. In 1924, the metal’s price was six times that of gold. The mass production of nitric acid using the Ostwald process in 1902 marked a turning point for industrial demand, as platinum catalysts became widely used.

The peak was reached in March 2008 with an all-time high of $2,273 per ounce, driven by financial crisis uncertainty and industrial demand. Since then, platinum has continuously lost relative shine compared to gold.

Trading Strategies for Active Investors

For traders who want to use platinum as an investment via CFDs, the trend-following strategy with moving averages (Moving Averages) proves effective:

• Fast MA (10 periods) crosses above slow MA (30 periods) from below: buy signal
• Reversal indicates sell
• Leverage of 3–5× with strict risk management

Critical for success: Risk no more than 1–2 percent of total capital per trade. For example, with €10,000 capital: a €100 risk per trade at 5× leverage means the position should not exceed €1,000.

Outlook for 2025: Consolidation Ahead?

After an impressive 50 percent increase since the beginning of the year, there is a risk of consolidation. While the physical deficit is real, and the weak dollar remains a price driver – market manipulations have also contributed. Profit-taking could temper the euphoria.

Key factors will be: the US dollar development, the stability of jewelry and jewelry demand considering US tariffs, and potential supply recoveries despite structural deficits until 2029.

Platinum as an investment currently deserves attention – but investors should clearly distinguish between genuine long-term investment and short-term speculation. Those who diversify and proceed disciplined can benefit from the platinum supply deficit.