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Commodity Trading: Platinum Futures

Overview

Spanish Conquistadors discovered platinum approximately 400 years ago when they were panning for Gold in Choco region of what is known today as Colombia. Considered a nuisance as Platinum interfered with gold panning, Platinum was discarded as worthless until a Swedish Assayer, Scheffer, in 1751 successfully melted and worked the substance the Conquistadors could not "melt by fire or by any of the Spanish arts". Scheffer also included Platinum as an element, the seventh known to man. By 1780, French glass workers were using Platinum to make crucibles for glass production since Platinum did not melt at the extreme heat used to make glass. Platinum's resistance to heat, corrosion, and strength made it an important industrial metal.

From its initial discovery in Colombia until 1822, South America was the world’s only Platinum producer. Colombia ceased exporting Platinum after it gained independence from Spain. Luckily for the growing Platinum market, a new supplier was soon found in Russia. Discovered in the Ural Mountain Gold fields, Russia soon became the world’s supplier of Platinum and is still the world’s second largest producer. Russia was also the first country to mint Platinum coins, introducing this metal to the world as both an industrial and precious metal.

The industrial and materialistic uses of Platinum have grown over the years. In the 19^th century when jewelers were able to melt Platinum, "white gold" began to replace Silver in jewelry. The lustrous white color of Platinum better accentuates diamonds and the bands can be much smaller as it is over 100 times stronger than Silver.

Though Platinum is a relative new comer to the metals scene, this mineral is very important to industry today. On a relative volume of mined on an annual basis, Platinum has more industrial uses than both Gold and Silver combined. Over 90% of the known Platinum reserves in the world are concentrated in 4 countries in the world. This rich man’s Gold is over 16 times more rare than Gold.

SPONSORED BY:

Commodity Trader's Almanac 2008
Scott W. Barrie
Best Price $26.37
or Buy New $26.37

Disclosure of Risk: The risk of loss in trading futures and options can be substantial; therefore, only genuine risk funds should be used. Futures and options ARE not suitable investments for all individuals, and individuals should carefully consider their financial condition in deciding whether to trade. Option traders should be aware that the exercise of a long option would result in a futures position.

SEASONAL TENDENCIES ARE A COMPOSITE OF SOME OF THE MOST CONSISTENT COMMODITY FUTURES SEASONALS THAT HAVE OCCURRED IN THE PAST 15 YEARS. THERE ARE USUALLY UNDERLYING, FUNDAMENTAL CIRCUMSTANCES THAT OCCUR ANNUALLY THAT TEND TO CAUSE THE FUTURES MARKETS TO REACT IN SIMILAR DIRECTIONAL MANNER DURING A CERTAIN CALENDAR YEAR. EVEN IF A SEASONAL TENDENCY OCCURS IN THE FUTURE, IT MAY NOT RESULT IN A PROFITABLE TRANSACTION AS FEES AND THE TIMING OF THE ENTRY AND LIQUIDATION MAY IMPACT ON THE RESULTS. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT HAS IN THE PAST, OR WILL IN THE FUTURE, ACHIEVE PROFITS USING THESE RECOMMENDATIONS. NO REPRESENTATION IS BEING MADE THAT PRICE PATTERNS WILL RECUR IN THE FUTURE.

HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL, OR IS LIKELY TO, ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM.

ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM, IN SPITE OF TRADING LOSSES, ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS, IN GENERAL, OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS.