BlackRock: Platinum Top Pick


"Of all the metals out there, platinum is the most constrained."

BlackRock, the world's largest asset manager, favors platinum over other metals due to production constraints and said the plentiful supply of silver will number its days of outperformance over gold.

Catherine Raw, comanager of BlackRock's World Mining Fund, which has some $16.87 billion in assets under management, said gold was well supported by a cloudy global growth outlook, political uncertainty and low real interest rates.

Negligible growth in global platinum mine supply coupled with gradually improving demand make it a top pick for BlackRock, which has allocated 3.9% of the cash in the mining fund to South African producer Impala as a means to tap into the metal's potential outperformance.


"Of all the metals out there, platinum is the most constrained in our view, and that's where we look to get exposure to, because we can predict supply more accurately than we can demand," Raw said.

"For demand, we can predict longer-term trends; but knowing what month-on-month demand is going to be is difficult. What you can do much better is predict supply growth, so you can recognize where the upside risk is to supply side shocks—and platinum ticks that box hugely."

Platinum, which is mainly used in catalytic converters for diesel-powered vehicles, as well as jewelry, has lagged the other precious metals.

The price has risen by 4% over the last 12 months compared with a 26% year-on-year gain in gold and a 122% rise in silver.

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