A Key Indicator Helps Track the Demand for Platinum
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View from the Observation Deck

  1. Most investors are probably less familiar with platinum than gold, silver, aluminum or copper.
  2. The top three uses for platinum are autocatalysts (catalytic converters for cars), industry and jewelry.
  3. While the overall percentage of platinum used in manufacturing catalytic converters is currently 32%, according to Platinum Today, it has been closer to 50% in the past.
  4. As the chart above shows, U.S. car sales declined from a pre-credit crisis level of around 17 million vehicles a year to an annualized pace of 13.2 million in 10/11. (Bloomberg)
  5. Sales actually fell below a 10 million annualized pace in 2008 amidst the credit crisis.
  6. U.S. auto sales, however, could rise to an annualized pace of 14.0 million by the second half of 2012, according to J.D. Power and Associates and LMC Automotive.
  7. The spot price of platinum stood at $1,555 an ounce during the trading session on 11/22. At that level, the price was down approximately 10.3% in 2011. (Bloomberg)
Posted on Tuesday, November 22, 2011 @ 4:06 PM

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.