Platinum or Gold 2025: Which precious metal offers more opportunities?

Current Market Status: Platinum on the Rise

The precious metals markets show an interesting divergence in 2025. While gold prices broke through the $3,500 mark in April and have established above $3,300 per ounce, platinum experienced a surprising renaissance. After years of stagnation, the shiny white metal was trading at around $1,450 per ounce in July 2025 – an increase of over 50% since the beginning of the year. This development raises an old question anew: Is platinum really the worse choice compared to gold?

Why Platinum Long Remained in Gold’s Shadow

To understand the current market dynamics, it’s worth looking at the price history of both metals. In 2014, platinum traded well above $1,500, significantly higher than gold. But while gold showed a continuous upward trend, platinum’s price development resembled a roller coaster. The most dramatic drop was in 2020, when platinum fell below $600. For years, the price fluctuated around the $1,000 mark – a situation that frustrated many investors.

The primary reason for this divergence lies in the automotive industry. Platinum is mainly used in diesel catalysts, whose demand sharply declined due to stricter emission standards and the shift toward electric vehicles. In contrast, gold benefits solely from its role as a store of value and inflation hedge – regardless of economic fluctuations.

However, this story is beginning to change. The platinum-gold ratio, which has been negative since 2011 (the longest negative phase in the price history of both metals), indicates a possible revaluation.

2025: The Turning Point?

The price jumps in platinum since the beginning of the year are no coincidence. A perfect storm of several factors has brought the metal back into focus:

Supply-side constraints: South Africa, the world’s largest platinum producer, is struggling with structural production issues. Global supply stagnates – only about 1% growth is expected in 2025.

Extreme physical scarcity: Lease rates (fees for short-term lending of platinum) have risen to record highs, signaling a tightly supplied market.

Structural deficit: According to the World Platinum Investment Council, demand in 2025 is estimated at 7,863 koz (kilounzen), while supply reaches only 7,324 koz. The deficit of 539 koz must be covered from inventories – an unsustainable situation in the long run.

Surprisingly stable demand: Especially in China and the jewelry sector, demand remains robust. The jewelry industry will generate a demand of 1,983 koz in 2025 (+2% compared to 2024).

Macroeconomic factors: A weak US dollar and geopolitical tensions have additionally driven platinum purchases. ETF inflows also show that institutional investors are rediscovering the metal.

Platinum vs. Gold: Fundamental Differences

Both metals have completely different characteristics:

Gold is a pure investment asset. Its price is driven by interest rate expectations, inflation, and confidence in fiat currencies. As a classic crisis hedge and diversification instrument, it deserves a place in every portfolio.

Platinum is a hybrid. Besides its role as a store of value, it serves as a consumable in the automotive industry (41% of demand in 2025), medical technology, jewelry (25%), and increasingly in green technologies like hydrogen fuel cells and catalysts. This duality makes platinum more volatile but also potentially more profitable during economic growth phases.

Rarity: Platinum is significantly rarer than gold. Yet, its price has lagged behind gold for years – a classic undervaluation that appears interesting for speculation.

The Demand Structure in 2025 in Detail

A granular view reveals where the risks and opportunities lie:

The automotive industry remains the largest buyer with 41% (3,245 koz), but growth is only projected at +2%. The biggest uncertainty: if US or Chinese industrial production grows faster than expected, demand could increase significantly. Conversely, trade conflicts between the US and China could dampen forecasts.

Industrial demand is expected to decline by -9% (2,216 koz), explaining the overall demand decrease of -1%. However, this could quickly reverse if economic impulses stimulate the chemical industry, electronics manufacturing, or catalyst production.

The jewelry sector remains stable (+2% at 1,983 koz) and benefits from platinum’s elegance and rarity. This area offers less volatility than industrial sectors.

The investment segment is the most dynamic, with an expected +7% growth to 420 koz – a clear sign that institutional and private investors (are rediscovering) that platinum offers better opportunities than two years ago.

Historical Context: From Russia to Today

Platinum’s investment history is surprisingly young. While gold and silver have been mined since antiquity, platinum only entered circulation in the 19th century. The first state-issued platinum coin was minted in Russia in 1828 – long the only option for European investors. After the export ban in 1845, a price collapse followed, which only recovered after decades.

The 20th century brought an industrial renaissance. From 1902, after the patenting of the Ostwald process for nitric acid production, platinum became indispensable for automotive catalysis. In 1924, platinum prices rose to six times gold prices. World wars slowed this development until platinum entered a new cycle from 2000 onward. In March 2008, at the height of the financial crisis, platinum reached its all-time high of $2,273 – driven by uncertainty and rising industrial demand.

This history shows: platinum does not move solely with gold. It is sensitive to industrial cycles and geopolitical shocks.

Investment Options: From Physical to Leveraged

Different investor types have various ways to access platinum:

Physical possession: Coins and bars offer security of ownership but require safe storage (with associated costs). This option suits long-term hoarders, not traders.

ETFs and ETCs: These instruments track platinum prices and can be easily integrated into a portfolio. Ideal for investors who want diversification benefits without worrying about storage.

Mining stocks: Those betting on rising platinum prices and company profits can invest in platinum producers. Additional factors like operational efficiency and debt levels play a role.

CFDs: For active traders with leverage. A CFD on platinum allows controlling large positions with small capital. With 5x leverage, a 1% price change can mean a 5% profit or loss. These instruments require strict risk management.

Futures and options: Complex instruments for experienced speculators. High profit but also loss potential.

Practical Trading Strategies for Platinum Speculation

For active traders looking to leverage platinum’s volatility, the trend-following strategy is a proven approach:

Use a fast (10-day) and a slow (30-day) moving average (Moving Average). When the fast crosses above the slow MA from below, it’s a buy signal – open a position with, for example, 5x leverage. Hold until the fast MA crosses below the slow again (sell signal), then close.

The critical element: risk management

• Risk only 1-2% of total capital per trade: For €10,000 capital, risk at most €100-€200 per trade.
• Use stop-loss orders: Set a stop-loss 2% below entry price. This automatically limits your loss.

Practical example:

• Total capital: €10,000
• Max risk per trade (1%): €100
• Stop-loss: 2% below entry
• Leverage: 5x
• Max position size: €1,000 (since 2% price drop x 5 leverage = 10% position loss = €100)

Failing to follow this rule guarantees faster losses than gains.

Conservative Allocators: Platinum as a Diversifier

For long-term portfolio managers with stocks and bonds, platinum offers real added value. The metal exhibits its own supply and demand dynamics and only partially correlates with equities. During economic crises, platinum can even react differently than stocks – a more valuable hedge instrument than gold alone.

The ideal allocation for platinum is individual. A portfolio with 5-10% platinum exposure (via ETCs or physical) can be sensible to:

• Curb inflation erosion
• Hedge currency risks
• Benefit from industrial cycles

Important: The increased volatility of platinum can raise overall portfolio risk. Regular rebalancing and combining with other precious metals is recommended.

Platinum Forecast 2025 and Beyond

The medium-term outlook for platinum is neutral to slightly positive:

The structural deficit of 539 koz in 2025 is expected to continue until 2029. As long as production capacities remain limited (which has no quick fix), platinum remains supported.

However: After the 50%+ price gains since January, there is an increased risk of consolidation until the end of 2025. Broad profit-taking could push the price back below $1,300. The key factors for price development are:

1. The US dollar: A weak USD supports platinum prices, a strong USD hampers.
2. Chinese and US industrial production: Stronger-than-expected = additional demand, weaker = headwind.
3. Lease rates: These are your early indicators. Rising rates signal scarcity and higher prices; falling rates indicate the opposite.

The Conclusion: Platinum or Gold – or Both?

Gold remains the classic store of value – indispensable for inflation protection and crisis preparedness. Its returns have been unmatched over the past 15 years.

Platinum, on the other hand, is the more speculative but also potentially more rewarding play. Its extreme undervaluation (relative to gold and its rarity), the structural deficit, and the renewed industrial demand make it an interesting candidate in 2025 – for both speculative traders and as a portfolio diversifier.

For traders: Leverage platinum’s volatility with clear risk management. For investors: A 5-10% allocation via ETCs offers return and diversification potential.

The question “Is platinum better than gold?” cannot be answered definitively. They serve different roles. But one thing is clear: after years of neglect, platinum finally deserves renewed attention in 2025.