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Should You Invest In Palladium???

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@rollandthomas
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Palladium is widely used in three-way catalytic converters in car exhaust systems. Palladium is also used jewelry and in dental fillings and crowns. Another common use for palladium is in multilayer ceramic capacitors. These are an important part of common electronics equipment such as cell phones, laptops, fax machines, etc. Palladium is also used in connector plating for a number of electronics.

Almost half the supply of palladium was used for the car industry due to tighter emission standards around the world, especially Europe. Palladium is used in catalytic converters to remove hydrocarbons, carbon monoxide, and other harmful gases from being emitted into the air.

Palladium prices fell into bear market territory back in February on fears of COVID-19 dampening the worldwide economy, along with slowing Chinese car sales. On one particular day, Palladium dropped as much as 30%, the biggest-ever intraday loss in records back to 1986.

Then as the equity markets bottomed out in March, Palladium prices jumped amid renewed optimism about China’s economy reopening and planned stimulus for automakers.

It's apparent, at least in the first half of this year, Palladium prices were positively correlated to the equity markets. So, should you invest in Palladium based on where we are at this point in the economic cycle?

Investors who are considering commodity investments to hedge against inflation or to diversify can turn to palladium to reduce portfolio risk, experts say.

Precious metals should be part of a well-diversified portfolio says Marc Lichtenfeld, chief income strategist at The Oxford Club in West Palm Beach, Florida.

"Just like you'd have various types of assets in a diversified portfolio, investors can diversify within asset classes. Many investors think only of gold and silver when it comes to precious metals, but palladium and other metals can add to that diversification," he explains.

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I never thought to consider Palladium as a hedge. However, when I look at the weekly chart of Palladium, price is reacting to a weekly supply at $2500. So Palladium is a no touch, as I think the better opportunity is in Silver.

This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.

Posted Using LeoFinance