Platinum reaches a new high, becoming the most important precious metal asset allocation option besides gold and silver.

Platinum (White Metal) continued its fierce rally at the beginning of 2026, building on last year’s momentum, and has become a new focus in the global precious metals market. Looking back at 2025, platinum prices hit a record high, with an annual return of over 125%, ranking second among major precious metals after silver, and outperforming gold overall. As we enter the new year, platinum prices continue to rise driven by multiple structural bullish factors, indicating that this rally is not a short-term speculation but a long-term trend based on supply and demand fundamentals and capital flows. Wall Street analysts are optimistic about platinum’s market prospects, viewing it as the next hot investment target in precious metals. This article is an excerpt from analyst insights on Seeking Alpha, purely market observation, not investment advice.

What is platinum?

Platinum (Platinum, also known as White Metal, is one of the rarest metals on Earth, with production lower than gold and silver, and highly concentrated in a few mining regions. Thanks to its unique physical and catalytic properties, platinum has been widely used in automotive emission controls, industrial processes, medical devices, electronic components, and more recently, in hydrogen fuel cells and energy transition technologies. Its dual nature as both a “precious metal” and an “industrial metal” makes platinum a hedge during market turbulence and benefits from growth in physical demand during economic and technological transformation cycles.

Platinum prices surge as gold and silver lead the rally

The significant rise in platinum prices in 2025 was driven by several key catalysts. First, the EU’s policy to ban internal combustion engines by 2035 eased concerns about a rapid decline in automotive catalyst demand, leading to a reevaluation of platinum’s demand outlook. Second, global trade policy uncertainties and rising geopolitical risks prompted capital to flow back into the precious metals market. After the Trump administration took strong actions against Venezuelan leader Nicolás Maduro, geopolitical risks soared, and platinum, gold, and silver all rose simultaneously, reflecting increased risk aversion among investors.

Sibanye Stillwater Limited, a platinum group metal producer, shares soared 380%

The performance of mining stocks also reflects the strength of the platinum bull market. Sibanye Stillwater Limited, one of the world’s largest platinum group metal producers, saw its stock price increase over 380% in the past 12 months, significantly outperforming the broader market. Although the Chicago Mercantile Exchange temporarily raised margin requirements, causing a brief pullback in platinum prices at the end of last year, the long-term bullish trend remained intact.

From a supply and demand perspective, the structural bullish factors for platinum are quite clear. On the demand side, automotive catalysts still account for nearly 40% of total platinum demand, followed by jewelry, industrial applications, and investment demand. Even as electric vehicle penetration increases and automotive catalyst demand may gradually decline in the coming years, growth in medical, electronic, and hydrogen energy technologies is expected to fill this gap within five years, increasing platinum’s role in energy transition. On the investment side, China has become the world’s most important platinum market, accounting for about 80% of platinum bar and coin demand. With platinum still trading at a significant discount to gold, platinum jewelry and investment demand in China are rapidly rebounding.

Supply constraints are also a key long-term foundation for platinum’s price increase. About 78% of global platinum reserves are concentrated in South Africa, which has faced ongoing issues such as energy shortages, mine aging, and underinvestment in recent years, leading to a decline in platinum group metal output. The World Platinum Investment Council indicates that in 2025, the platinum market will experience a third consecutive year of significant supply deficits, with above-ground inventories only sufficient to meet about five months of demand. Although supply and demand may temporarily balance in 2026, structural shortages are expected to re-emerge from 2027 to 2029, with inventories continuing to decline.

Platinum’s lower price compared to gold offers good value

Analysts believe that even though platinum prices have hit record highs, from a long-term relative value perspective, platinum remains significantly undervalued compared to gold, with higher investment returns. This makes platinum a more cost-effective choice amid the rotation among precious metals and attracts capital seeking diversification from gold. However, platinum is a high-volatility commodity, and its prices are susceptible to economic recessions, financial events, and speculative sentiment, making it unsuitable for all investors.

Regarding investment tools, compared to physically purchasing platinum—which involves high premiums, transportation, storage, and security costs—analysts favor platinum ETFs. Currently, the two most highly rated quantitative products are abrdn Physical Platinum Shares ETF (PPLT) and GraniteShares Platinum Trust ETF (PLTM). Both are backed by physical platinum bars and track the London Platinum and Palladium Market Association’s platinum benchmark price directly, avoiding the complexities of futures rollovers and derivatives.

PPLT has a larger scale and better liquidity, with impressive performance over the past year and a top-tier momentum rating; PLTM offers a slightly lower expense ratio, attracting investors, and although smaller in size, maintains acceptable trading activity. Both ETFs are rated as “Strong Buy” by quantitative models, making them core tools for participating in platinum’s bullish trend.

In a macro environment of increased market volatility, declining interest rates, and a weakening dollar, platinum combines hedging properties with industrial growth themes. Coupled with long-term structural factors such as limited supply and declining inventories, platinum has the potential to benefit continuously in the next wave of precious metals enthusiasm. For investors seeking to diversify their portfolios and willing to accept commodity price volatility, platinum and its related ETFs are once again emerging on the global asset allocation stage.

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