Platinum, Palladium ETFs Set To Trade Friday


"Platinum group metals have outperformed gold since the beginning of December. . ."

The first U.S. platinum and palladium exchange-traded funds will launch on Friday, giving U.S. investors easier access to the industrial metals, which have already rallied on hopes for more fund-based stockpiling.

Analysts expected the new products to give platinum group metals a shot in the arm and fill some of the void left by lower demand from the beleaguered auto sector.

NYSE Euronext said on Thursday that ETFS Physical Platinum Shares PPLT and ETFS Physical Palladium Shares PALL will begin trading on the NYSE Arca platform. The funds are wholly owned by London-based ETF Securities Ltd.

"Everybody tends to rush into gold when they think of precious metals. Platinum group metals have the added benefit of a high level of industrial input," said Bill O'Neill, partner at New Jersey-based LOGIC Advisors.

Platinum group metals have outperformed gold since the beginning of December, when the launch of the ETFs was widely anticipated among traders.

During that period, platinum was 7% higher, and palladium was up 17%, compared with a 4% decline in gold.

"With the growth of car usage in India and China, demand for platinum group metals should be quite buoyant. It's going to be a metal that attracts a lot more attention in the future," O'Neill said.

Investment in platinum has been rising even as demand from the auto industry fell for the first time in 10 years. Some traders believe a broad economic recovery is in the making that will stimulate more demand from car makers.

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