INVESTING IN PRECIOUS METALS

Over the past decade, precious metals have taken a back seat to securities as the preferred investment vehicle by the majority of investors. The slippage in preference among investors, however, does not necessarily mean that investing in precious metals is not a good strategy for some investors.

This research provides an analytical and comparative assessment of precious metals as an investment vehicle. This assessment covers four precious metals ù gold, palladium, platinum, and silver. The presentation of the findings of the assessment is in three major sections, as follows: (1) a comparison of the performance of the four precious metals covered in the research; (2) a consideration of factors that argue for or against investment in precious metals as opposed to other investment vehicles; and (3) optional investor strategies for investing in precious metals.

Comparing the Performance of Four Precious Metals as Investment Vehicles: Gold, Palladium, Platinum, and Silver

Gold has an ancient history as a preferred investment vehicle. Gold, however, has lost some of its luster since the mid-1980s. Exhibit 1, which may be found on page 3, provides a graphic illustration of gold prices for the 30-year period 1972-2001. The exhibit presents three price levels for each year ù the high trading price for the year, the average trading price over the entire year, and the low trading price for the

. . .
other precious metals. Exhibit 4, which may be found on page 8, provides a graphic illustration of silver prices for the 30-year period 1972-2001. The exhibit presents three price levels for each year ù the high trading price for the year, the average trading price over the entire year, and the low trading price for the year. As the data presented in Exhibit 4 indicate, silver prices remained relatively steady over the 30-year period of analysis, with the exception of the 1979-1982 period. Since 1985, silver has traded in a relatively narrow range. Over the 1985-2001 period, silver prices have trended slightly downward, although there have been some modest price increases ù 1987, 1994, and 1998. Exhibit 3
Exhibit 4
As Exhibit 4 also indicates the price volatility (defined for the purposes of this study as the percentage variation between high and low trading prices) of silver has been relatively moderate with the exception of the 1979-1983 and another exception in 1987. Price volatility increased again in 1998, but was short lived. Price trends and price volatility for the four precious metals are compared directly in Exhibits 5 and 6 respectively, which may be found on the following two pages. Base
. . .

Some common words found in the essay are:
Silver Gold, Retrieved Internet, Standard Poors, ASSESSMENT Introduction, Metals Investing, Investment Vehicles, Africa Russia, precious metals, Conclusion Investing, 2001-06-13 http//wwwkitcocom/ cgi-bin/yearly_graphscgi, internet 2001-06-13 http//wwwkitcocom/, London Kitco, Kitco Retrieved, london kitco retrieved, http//wwwkitcocom/ cgi-bin/yearly_graphscgi, retrieved internet, internet 2001-06-13, 2001-06-13 http//wwwkitcocom/, london kitco, kitco retrieved, retrieved internet 2001-06-13, kitco retrieved internet, cgi-bin/yearly_graphscgi kitco, kitco 2001, trading price,
Approximate Word count = 1775
Approximate Pages = 7 (250 words per page)

More Essays on INVESTING IN PRECIOUS METALS