While equities have rebounded from this year’s earlier pullback, investors are increasingly revisiting alternative investments like precious metals for diversification and downside protection. While gold and silver often dominate the precious metals narrative, platinum ETFs are quietly gaining attention. So far in 2025, platinum prices have increased almost 50% YTD, reaching their highest level in over 10 years. For investors and advisors curious about investing in platinum, this note provides an overview of growth drivers, market characteristics, and ETF investment options.
Platinum is relatively under-the-radar as an investment compared to gold and silver
While gold is primarily an investment asset and silver depends heavily on industrial use, platinum is a hybrid of both. According to the World Platinum Investment Council, 56%-78% of platinum demand comes from automotive and industrial applications. Its industrial and automotive demand is followed by 23%-29% jewelry demand. That demand driver has been strengthening due to the high sustained price of gold. And lastly, investment demand makes up the remaining (small) amount. This means platinum tends to perform well during periods of industrial recovery and technological shifts, while still offering some of the safe-haven appeal behind precious metals.
While demand continues to remain healthy over recent years, supply has grown constrained. The WPIC predicts that platinum will hit its third consecutive year of supply deficit (see this article). Part of that is due to a large amount of production (70%) focused in South Africa that has recently declined. This is in contrast to gold production, where risk is more dispersed. According to gold.org, China is the largest producer of gold, with only 10% of global production.
Platinum as part of a diversified commodities allocation
Although gold will typically dominate precious metals exposure in portfolios, platinum’s demand drivers position it well for investors looking to diversify exposure across commodities. Platinum, however, also carries risks. The market remains relatively small and illiquid compared to gold and silver. And pricing can be highly sensitive to changes in automotive technology (platinum is typically used for traditional automobiles rather than electric vehicles) and mining supply disruptions. Still, for those with a longer-term horizon and an interest in industrial innovation and precious metals, platinum ETFs offer an interesting opportunity. Used in combination with gold and silver, platinum could potentially enhance a diversified commodities allocation.
While platinum has outperformed this year, it has modest inflows
Platinum ETFs have seen renewed interest this year. There are currently two physical platinum ETFs, which are significantly smaller than the largest gold and silver ETFs.
- The largest physical platinum ETF, the abrdn Standard Physical Platinum Shares ETF (PPLT ), has $1.6 billion in assets. It has received just over $100 million in net inflows so far this year. The fund is backed by physical platinum stored in secure vaults. It offers investors direct exposure to spot platinum prices without the complexities of futures contracts.
- While the GraniteShares Platinum Trust (PLTM ) is smaller, at around $81 million in assets. It has a lower expense ratio (50 basis points versus PPLT’s 60 basis points). Like PPLT, PLTM is backed by physical platinum. Both PPLT and PLTM store their platinum in London. Each fund discloses holdings regularly on their websites (PPLT currently has 11,410 bars, while PTLM currently has 860 bars).
- Platinum can also be found in broader physical precious metals funds like the abrdn Physical Precious Metals Basket Shares ETF (GLTR ). This fund holds multiple precious metals in physical storage. These include: gold (66.4% of net assets as of March 31, 2025), silver (26.6%), palladium (4.2%), and platinum (2.8%). Platinum is a small portion of this diversified ETF. So investors who want a higher allocation to platinum might prefer PPLT or PLTM. But GLTR can serve as a good hands-off approach to a diversified precious metals fund, especially for those who prefer a larger exposure to gold and silver.
Bottom Line: Platinum ETFs have performed well this year due to supply imbalances, and may also provide exposure to industrial growth potential in a diversified precious metals or commodity allocation.
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