After the success of its gold bar sales, Costco has introduced one-ounce platinum bars to its online offerings, priced at $1,089.99 each.
The retail giant’s move into selling platinum follows the massive popularity of its gold bars, which brought in $100 million in sales in 2023. However, while gold has proven a strong investment over the years, some financial experts are advising caution when it comes to investing in platinum.
Platinum, while used in jewelry like gold, has more industrial applications, particularly in the automotive sector for catalytic converters. Yet, its price has struggled compared to gold, with current values hovering around $1,000 per ounce — lower than the $1,250 per ounce seen a decade ago. In contrast, gold prices have soared, increasing from about $1,200 per ounce 10 years ago to nearly $2,700 today.
Despite platinum’s industrial relevance, particularly in gas-powered and hybrid vehicles, its future demand is uncertain due to the growing shift toward electric vehicles, which do not require catalytic converters. Edward Sterck, director of research at the World Platinum Investment Council, remains optimistic about platinum’s future, citing its rarity and other industrial uses, but many analysts remain cautious.
Financial experts generally agree that while precious metals can act as a hedge against inflation, investing in physical bars may not be the best approach for most people. Issues like storage, insurance, and limited liquidity make physical metal less attractive compared to exchange-traded funds (ETFs), which are easier to manage and sell. Michael Martin, a market strategist at TradingBlock, also pointed to the growing electric vehicle market as a potential headwind for platinum demand.
While Costco’s platinum bars have generated buzz, much like its gold and silver offerings, some experts recommend that investors consider other options, such as ETFs, if they want to invest in precious metals. Nonetheless, the allure of owning physical platinum remains for certain buyers, especially those who value tangible assets in uncertain times.
Market Watch, CNBC, and Fortune contributed to this report.
