A Platinum IRA is a self-directed IRA that includes platinum coins and bars. Many investors are unaware that platinum may be added to an IRA in addition to gold and silver.
Historic Performance of Platinum
During the early 1970’s, the price of platinum declined in value as the price of gold went up. When the stock market plunged in 1974, the price of gold sky-rocketed. The value of platinum trended upward around the year 2000 when experts speculated that society had more confidence in the government and our financial system. As the economy hit a new low in the early 21st century, the price of platinum down-trended again. In many cases, the relationship between platinum and gold worked together for at least four years. However, historical references show that when platinum has dropped drastically in value, it has sharply bounced back at a value higher than that of gold.
What is Allowed in a Platinum IRA?
Under the Taxpayer Relief Act of 1997, precious metals included in an IRA must meet certain specifications and minimum fineness requirements. Platinum coins and bars must have a fineness of .9995 or greater to be eligible. Bars must be manufactured by a NYMEX- or COMEX-approved assayer/refiner or a national government mint.
Benefits of Opening a Platinum IRA
Owning precious metals like platinum is another way to diversify your retirement portfolio. Platinum is even rarer than gold and silver and has widespread industrial applications. If you already own gold or silver in your IRA, adding platinum can further diversify your precious metal holdings.
Platinum and Gold Factors
Platinum and gold tend to operate in opposite directions. When gold is increasing in value, platinum tends to decrease. When gold decreases in value, platinum increases in value. This is because of the way that the precious metals respond to different economic factors.
- Gold Factors – The value of gold tends to increase when other aspects of the financial market are in peril. For example, a banking crisis, the devaluation of the dollar or other legal tender, or speculation as to the security of government bonds can make the value of gold increase.
- Platinum Factors – In contrast, platinum tends to increase in value when there are long stretches of economic growth or when investors believe that monetary stability is a part of the current economy. However, platinum is also used in a number of industrial applications. Therefore, when its demand decreases its value also tends to decrease.
Popular Coins and Bars for Platinum IRAs
The American Bullion Platinum IRA
If you would like to add platinum or other precious metals to your investment portfolio, American Bullion can help set up a Gold IRA for you today. Contact us at 1-800-326-9598 to speak with a specialist.