The Quandary Of Rebalancing

The two main ways of rebalancing one’s investment portfolio are either through cash injections, or the selling of an asset class and buying into another. During rebalancing, some investors may face a dilemma of sorts in the form of opportunity costs (or reinvestment risk, depending how one views it), and the need to maintain the portfolio asset allocation. 

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Putting it into an example of a simple equities/bond portfolio, at the point of rebalancing, the equities portion is already over the allocation, yet an investor is not willing to tip the scales over to bonds due to its current lower returns compared with equities. If this investor goes ahead with plowing more into equities instead, he/she had defeated the purpose of rebalancing, and subsequently diversification.

Unless the portfolio is concentrated for a known purpose or for trading, having a heavily skewed investment portfolio would bring unnecessary risks. Yes, one may forego the additional gains and yields that the additional capital may bring, but for the sake of portfolio preservation and being in the comfort zone of one’s risk tolerance and appetite, rebalancing is a must-do.

Borrowing a saying heard in team sports:

No player (asset) is bigger than the team (portfolio) itself. 

Regulatory, Liquidity And Counterparty Risks

We are rapidly seeing the increase of multiple polarisations of geopolitical blocs and the complicated world order that we may be heading into, and these may amplify some of the risks that most investors tend to overlook. Most of us would associate risks as total loss of an investment due to market and economic forces, but we need to be aware of other forms of risks that, though the probability of it happening may seem be remote. Examples of these risks are regulatory, liquidity and counterparty risks.

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Regulatory risks are events where regulations, legislation and/or standards have a negative effect on certain sectors/industries. There are a few examples, one of which is the ever-present government antitrust suits against the technological giants.

Liquidity risk, from the market perspective, is one where a counter could not be sold, or liquidated, in required time, because of low or no demand for it. Some may have experienced liquidity risk when their shares/bonds were suspended on an exchange, oftentimes stuck there almost forever.

Counterparty risk is the failure of the other side (i.e., the counterparty) in carrying out their obligations of a financial transaction, such as the delivery of securities after payment has been made, or the failure of a bond to distribute a scheduled coupon payment.

After having introduced the risks and bringing back to the point said in the first paragraph where these risks are amplified, the growing geopolitical tensions would probably have, or had have, them manifesting as a sequence of events. A famous instance was the SWIFT (pun intended) sanctions placed on Russia the moment they invaded Ukraine, which led to, among others, the severance of the Russian market from Western investors. Regulatory risk (brought about by sanctions), then liquidity risk (unable to access the Russian markets to liquidate holdings) and at the same time, counterparty risk (defaults occurred in the trading of Russian securities individually or by fund houses).

While accordingly investors had gotten back their monies from their respective exchange traded funds (ETFs) that had Russian securities, the period in-between would be harrowing especially for those who may have a huge position in them. This is a clear demonstration that governmental actions could bring about a huge dent in one’s investment portfolio.

The abovementioned scenario could well play out if non-Western region or country is trying to do something funny in the great global game, and I could probably hear murmurs of turning away from global diversification and stick to local companies for safety. However, the best way to manage these risks is diversification itself.

Some may view this blogpost as scaremongering, but I must highlight that all investments carry risks, and it is up to the individual to determine the probability and one’s weightage of each of the risk types happening. Via diversification along the descending degree of asset classes, regions/countries, sectors/industries and then companies, and along with portfolio sizing (in my opinion, not more than 12% holdings for a company or a sector-based ETF), losses can be mitigated and limited in contrast to a wipeout had one instead concentrated. 

Disclaimer

Dark Side Factors That Could Derail Your Investment Portfolio

As part of the Star Wars Day (May the Fourth) special, I will share a post on dark side factors that could derail an investment portfolio.

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Dark Side Factor #1: No Diversification/Under-diversification

Imagine an investment portfolio that consists of only one counter, and if anything extreme happens to it, be it a company bankruptcy or a bond default, the whole portfolio goes poof. In non-extreme cases, a price drop of its securities would bring put a big dent, since basically the portfolio equals to that one counter.

Going further, though with the safety of numbers, there is this risk of under-diversification as well, especially if investments are on basically one sector/industry and/or one region/country. Think about an event that affects the entire sector/industry (e.g., airlines and travel during the COVID19 pandemic) and/or country/region (e.g., the Asian Financial Crisis of 1997) and what would happen to the portfolio.

The answer to deal with this would be adequate diversification, and for the Bedokian Portfolio’s case ranks in the following order: asset classes, region/country, and sector/industry. In this way the risks are spread, with the downside mitigated due to the net effects of correlation between the counters.

Dark Side Factor #2: No Rebalancing

Rebalancing and diversification go hand in hand, thus even with diversification done but with no rebalancing performed, there is still a danger to one’s portfolio. Allowing an asset class to deviate from the preferred or designated allocation would create concentration risk akin to #1, lost opportunities to invest in other asset classes at their lows, and not to mention compromising an investor’s risk tolerance when the portfolio moves away from the set make-up.

Rebalancing can be done in two main ways: either passive or active. Passive rebalancing is usually done periodically, e.g., quarterly, half-yearly or annually. Active rebalancing involves re-allocation to the portfolio make-up constantly or within a short period. Either way, if it is done, one will be steered away from the dark side.

Dark Side Factor #3: Getting Emotional

The Jedi practised emotional control so as not to be affected by them, and this extends to how one should manage their portfolios whether during happy and crunch times. Many times, I have had heard of the phenomenon of “buy high sell low”, and dumping everything to “run for the hills”, only for the investor to regret the decision later.

The markets and the economy go through a boom-and-bust cycle, which is part and parcel of the investment journey. As said countless times, stay calm, enjoy the ride, be rational and carry on investing, for its time horizon is long.

 

Dark Side Factor #4: Not Sticking To The Plan

It is good to fine tune a portfolio methodology and make-up to suit one’s preference and risk tolerance, but to do it extremely (e.g., switch totally from equities to cryptos, etc.) and/or frequently (e.g., Bedokian Portfolio this year, 60/40 equities/bonds next year, etc.) would likely bring lower returns and unnecessary risks than one had not made the change in the first place.

When embarking on the journey of investing, it is recommended to know one own’s objectives and risk appetite, and also read up to learn about it, which I had covered here and here respectively. Once these are in place and the investing philosophy and methodology established, it is easier to carry out according to plan, and perform tweaks down the road.

Dark Side Factor #5: Leverage

While using leverage could increase returns based on what some investing books had stated, for the uninitiated it could prove to be a handful when one need to monitor the portfolio and the borrowings simultaneously. With an even greater leverage on leveraged products, where returns and losses are heavily amplified, the risk of margin calls is greater.

When utilising borrowings, it is important that one should have a clear understanding of what he/she is doing, and the advantages and implications behind them. 

 

May the Fourth be with you. 

Learning Points From The Past Two Weeks

The happenings and experiences of investors and traders for the past two weeks, in my humblest opinion, serves as an almost comprehensive trove of learning points to take home with, especially for those who are new to the markets, and for veterans relearning the basics.

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While I can pick at least a dozen major and minor points to talk about, for this post I will select four which I deem them as important. I will also provide some links to my previous posts for detailed explanations on the points.

Learning Point #1: Everything Seems To Go Down

In times of market crisis, a common observation was that everything was going down, even safe assets such as gold. There are a few explanations, which I had covered here and here.

In gist, a lot of investors would want to preserve their capital by moving to safe assets, which may include bonds, commodities (gold in particular) and cash. The problem was that the vast quantum and speed of assets liquidated by so many people within a short time had caused demand and supply distortions, which in turn affected prices. Though equities were the hardest hit, there were also investors getting rid of the deemed safe assets, too, like bonds and gold, to hold onto the most liquid of them all: cash, before thinking of their next move.

After “Liberation Day” on 2 Apr 2025, gold went below USD 3,000 per oz before soaring to an all-time high again, which proved somewhat correct the points raised in the linked posts above.

Learning Point #2: No One Is Able To Predict The Markets

There are amateurs (retail investors and influencers), professionals (analysts and economists) and anyone in between that would constantly try to predict the market outcomes, with some backed-up by data and information, but no one is able to do it correctly. By prediction, what I meant was the ability to have the correct outcome at the correct time, right down to the ‘T’, and I dare say it is almost impossible to do it. Read this writeup for more details.

A related note to this point is that since no one knows how things would pan out, the things that was said by people in the media should be taken as opinions, not the truth, hence we should not be blindly following whatever was spoken.

Learning Point #3: Bottom Fishing

Rational investors would know the past two-week period as “the sale worth waiting for” and eagerly biding their time to purchase their targeted counters at their assumed right price. The ultimate prize would be going in at the “bottomest” price before shooting up again. Catching the bottom, though slightly easier than predicting, still requires sheer luck. Personally, I was able to sell a counter at its highest and bought another one at its lowest, both once, in my investing/trading life, and I attribute them solely to good luck, not acumen.

Rather than waiting to fish for the bottom, there are other methods in getting a counter near its lowest, where I had shared here.

Learning Point #4: Keep Calm And Carry On Investing

This is self-explanatory, so I shall not say more. 

Disclaimer

 

Sell Banks And Buy REITs?

I have had heard of the above mantra from chat groups and online blogs, possibly due to the perception that banks are (deemed) overpriced, and the recovery of real estate investment trusts (REITs) are in progress as observed from price movements and analyst reports.

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In portfolio management terms, this is rebalancing, where assets of different asset classes/regions/sectors are bought and sold to maintain the desired portfolio make-up. Within the action of rebalancing, however, there are variations in its execution; on one end some do it passively and periodically, while on the other end some do it actively and opportunistically to capture gains from anticipated events and news.

Back on the action of selling banks and buying REITs, it would be dependent on one’s portfolio, investment strategy and methodology used, and which part of the above described active-passive spectrum one is at. Depending on each investor’s circumstance, it may not be necessary to sell one and buy the other. For our case, as we are still in the accumulation phase, we rebalance by injecting capital, thus we buy both banks and REITs.

Providing more context and detail, we had recently deployed into OCBC when its price showed weakness during the middle of March 2025; this purchase is for averaging up our current holdings. For REITs, we had been nibbling them since interest rates started to spike in 2022, with the knowledge that every asset class would go through highs and lows in cycles (my oft stated “Sunday” and “Monday” moments).

Hence, to sum it all up, an investor needs to take stock (pun intended) whether the advice of “sell banks and buy REITs” is suitable for his/her investment philosophy and portfolio situation. If the advice is sound, then it must be rationally substantiated with reasons such as the purpose of doing so, the justification of fundamentals, etc. Following blind advice without facts and context is akin to listening to jumping into the deep end of the pool blindfolded and with hands tied, which someone with a sane mind would not do in real life.

Disclosure

The Bedokian is vested in OCBC.

Disclaimer

The Thing About Asset Class Correlations

In portfolio management, the term “correlation” has been mentioned many times as its very characteristic formed the basis of diversification among the asset classes. For those who are new to investing, correlation is “a statistical measure that determines how assets move in relation to each other”¹. As the various asset classes behave differently during differing market and economic conditions, their relative price movements with one another would be different given a set period or snapshot of time.

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However, there has been a notion that correlation in terms of price and returns is a zero-sum game. For example, in a portfolio consisting of two asset classes (let us call them A and B) and they are negatively correlated with each other, the assumption is that if the price of A rises, the price of B would drop, vice versa. Yes, that is correct, but only half; the correlation numbers are not fixed, and there are times where A and B gain together, and at times where both suffered losses together.

As stated above that correlation is a statistical measure, it is being defined by the time frame used. If in a day, the price of A and B moves in tandem, whether up or down, they are positively correlated with each other for that moment. However, if A and B moves differently from each other over a longer period, then their correlation may be less positive, or possibly even negative, for that said period.

Hence, it is not surprising to see A and B were having a negative correlation over set time, and yet both had positive returns. Providing a real-world example, I would use two asset classes that were conventionally opposites in the correlation thing, equities and gold (see Figure 1):

 

Asset Class	VTI	GLD	Annualised Return
Equities (VTI)	1.00	-0.14	23.81%
Gold (GLD)	-0.14	1.00	26.66%

 

Fig. 1: Asset class correlations of equities (represented by Vanguard Total Stock Market ETF (VTI) and gold (represented by SPDR Gold Shares ETF (GLD), 1 Jan 2024 to 31 Dec 2024, using monthly returns correlation basis. Source: Portfolio Visualizer.

 

The Bedokian’s Take

While correlation forms part of the overall concept of diversification, for the retail investor, my take is to be aware of it and how it works. Leave the correlation numbers crunching to the academics, analysts and financial bloggers like me to provide useful insights for all. 

Another trivia, which may come as a surprise to you, is that the main cause of correlation comes from you and me (sort of), and the rest of the participants in the financial markets. I will provide a couple of links under Related Posts below to understand why this is so.

Stay calm and stay invested.

Related posts:

Know This, And You Are Halfway Knowing How The Market Works 

Diversification Is Dead! Long Live Diversification! 

 

1 – Edwards, John. Why Market Correlation Matters. Investopedia. 31 Oct 2022. https://www.investopedia.com/articles/financial-advisors/022516/4-reasons-why-market-correlation-matters.asp#:~:text=Correlation%20is%20a%20statistical%20measure,in%20relation%20to%20each%20other (accessed 23 Feb 2025)

The Rationale Of The Asset Classes: The Bedokian Portfolio 300th Post Special

I was asked a few times on the asset classes in the Bedokian Portfolio, specifically on why I had included them. In fact, I had mentioned the rationale in my eBook, which I will reproduce here¹:

“Both equities and REITs provide dividends, with the former having higher potential capital growth; Bonds give a stabilising effect when equities and/or REITs are weakening, while still earning coupon payouts; Commodities, though it is a non-yielding asset class, give the necessary softening of the overall portfolio from volatility; Cash, though acting as a pool of liquidity, could still be an interest-bearing instrument.”

 

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For the past decade, we had seen the “Sunday” and “Monday” moments for each of the asset classes; equities lead the charge most of the time, save for the COVID and accelerating interest rate periods in 2020 and 2023-2024 respectively; REITs were the darlings for dividend investors, until COVID and high interest rates pressed them down; bonds were riding high during COVID as a flight to safety; commodities in general were muted until the post-COVID geopolitical uncertainties kicked in; cash languished until high rates spurred interest in treasury bills and fixed deposits.

 

The basis for all these is due to the different behaviours of each asset class under different economic conditions; in other words, they have different correlations with one another. If you had read the previous paragraph, not all of them had a bad time together, nor a good time together, too. In this way, our Bedokian Portfolios do not suffer the high swings of down and up experienced by an individual asset class, because if one or some asset classes plummet, the others would somehow “hard carry” up for the team.

 

Thus, the above example serves as an important lesson on diversification; the act of not putting all of one’s eggs into a basket. Though the gains may not be as much as placing all into one asset class (especially equities), but at least the risks and losses can be mitigated via diversifying. 

 

1 – The Bedokian Portfolio (2^nd Ed), p71

Investing With Emotions

Yes, you can do that, and I guess most of you would be thinking along this line: 

“Whoa! Wait a moment! Didn’t you say investing must be done on a rational approach, not through emotions?” 

Good question.

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And my answer is: Correct, investing must still be done rationally, but you can capitalise on others’ (not your) emotions to your advantage.

I had mentioned in the ebook that the price of a financial instrument is determined by its demand, supply and market sentiment¹. The emotional factor would come from the market sentiment part; whenever the market is bullish, prices would naturally go up, and vice versa in bear conditions.

It is at these relative extremities that you can consider how to manage your portfolio; when the markets are deemed to be overheated, you could take off some from the table by selling the overpriced securities. And in downtimes, you can look for depressed counters that are still fundamentally strong but got dragged down by negative sentiments. All these actions are also part of portfolio rebalancing, a key component of my oft-preached diversification.

 

1 – The Bedokian Portfolio (2^nd ed), p124

Know This, And You Are Halfway Knowing How The Market Works

I admit that the title of this post sounds like a click bait, but it is mostly true, at least based on my observations and conclusions.  In a way I had somehow stumbled upon a hypothesis that works most of the time.

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So, what is this wondrous hypothesis that could half answer how the markets work?

It goes like this:

Capital, assumed it is limited at the point of time, would either flow to assets that provide the most deemed yield, or to perceived safe assets, or both.

In layman speak, it would be:

Capital would go to securities that provide “more bang for the buck” and/or to a perceived safe haven.

If you had been reading my blog for at least the past three years, you may find the second italicized quote familiar; I had mentioned something along that line in this post, where I also emphasized on the importance of diversification. However, we can apply more from this hypothesis besides just diversification, and the accompanying trait of rebalancing. One way is to go contrarian.

 

Going Contrarian

The good thing about this hypothesis is that you can counter its logic and still profit from it. This is known as “going contrarian”.

When capital starts to move fast and huge, like a flash flood, you will notice big movements in the prices of assets and securities. As a retail investor, when these things are happening, it may be a bit late as other people would have jumped on the bandwagon before you, although maybe you are lucky enough to be at the tail end of it. The contrarian part is, since most are going with the metaphorical wave, why not go against it?

The thing about going contrarian is not to do it wholesale and blindly; it is important to pick the right ones and capitalise on it. For instance, if you are an active investor who goes for individual equities and real estate investment trust (REIT) counters, picking those that were financially healthy but got unfortunately dragged down by the overall bear situation was a good case of going contrarian intelligently. 

Though the contrarian way sounds like an act of portfolio rebalancing, which is long term in nature, it could also be used in medium term or short trading terms, too. 

Macroeconomic Lessons To Learn From The Past Two Years

Due in part to the spike in demand and limited supply of products in the aftermath of COVID-19, and a host of other reasons such as geopolitical ones (e.g. Russian-Ukrainian conflict) and the long period of low interest rates which flushed the economy with cheap-loan capital, caused inflation to rear its ugly head. The subsequent accelerated rise of interest rates that was never seen before since the mid-2000s had brought an unprecedented economic environment in which most younger investors had not experienced before.

The past two years or so had provided useful insights and learning opportunities for us investors, and that is attributed to one macroeconomic policy: interest rates. What I would be sharing in the next few paragraphs are theoretical knowledge found in economics and finance textbooks, and most of the occurrences did happen, thus giving a sort of “classic textbook examples”.

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Inflation And Interest Rates

When inflation is perceived to be happening, countries whose central banks can control interest rates (like the United States or U.S.) would raise them to bring inflation down. The rationale behind this is that when interest rates go up, the cost of borrowing would go up, and this slows down capital investments by companies as loans are getting expensive. Simultaneously, for consumers, higher rates meant higher returns from safe instruments such as short-term treasuries and bank deposits, which in turn encourages saving and less spending. All these cool down the economy and lower inflation.

For Singapore, instead of interest rates, our central bank (Monetary Authority of Singapore, MAS) used the exchange rate policy to manage the monetary policy. However, it is noted that our interest rates are very closely correlated with that of the U.S.’ in terms of direction and movement (see here and here for further explanations).

Effects On Asset Classes

Now that you got the gist from the previous paragraph, you could roughly tell what are the asset classes affected by high interest rates. Positively, as mentioned, are cash (in banks and money market funds) and short-term treasuries (less than two years). Negative ones include real estate investment trusts, or REITs (being leveraged investment vehicles, higher rates affect distributions to REIT unitholders), bonds (interest rates and bonds are inversely correlated) and lastly, commodities (which do not provide yield). For equities, though the cost of borrowing may affect the growth of companies, for some sectors such as finance (banks) and technology, as well as cash-rich companies, enjoyed some boom time.

True enough to a certain extent, we saw that REITs were hammered, a lot of people flocking to erstwhile boring treasury bills and fixed deposits, and gold was somehow muted throughout 2022 and 2023, to name a few.

Everything Is A Cycle

Good times do not last, and so are bad ones. All markets and economies go through a cycle, from bust to boom to bust to boom again. Now that the U.S. Federal Reserve had brought down rates, with more planned ahead, we could see treasury bill yields going down, REITs roaring back up, gold surging ahead, etc. The undulating nature of the market and economy, and the behaviours of the asset classes during these cycles, proved the importance of having a diversified portfolio with periodic rebalancing. With diversification and rebalancing, your investment portfolio can be protected from huge downswings and capital losses can be lessened. 

Ceteris Paribus

Last but not least, all economic scenarios and assumptions are accompanied by the term ceteris paribus, which translated from Latin is “all things being equal” (read here for more information). As we know, the economy is like a machine with many moving parts, working and affecting one another at the same time (read here for the economic machine analogy). Thus, even though we can observe “textbook examples” happening, sometimes it may not go according to theory, or even so, it might be other factors at play to give it a “textbook answer”.

Still, in my view, it is better to have some basic economic and financial knowledge to get a grasp of the complicated, yet simple, world of investing.

Platinum for Commodities?

With gold and silver rising (and taking a breather) recently, there was talk among my various channels on another overlooked precious metal: platinum.

Platinum is a silver-grey metal which is non-reactive and highly resistant to corrosion, like gold. Platinum has been used for centuries as jewellery, although not as extensive as gold.  Perhaps it is best known for its modern use, that as a catalyst in a catalytic converter in vehicles that still utilize internal combustion engines.

 

Platinum’s performance, at least in price, did not really conform with its precious metal siblings gold and silver. While gold and silver historically were somewhat positively correlated with each other, for platinum, that held true for a while until 2016 or so when it started to diverge (see Figure 1).

Fig.1: Platinum prices (blue) vs gold prices (orange) from 1985 to present. Grey columns denote recession periods. Source: Macrotrends.

Despite platinum being scarcer and costs more to process than gold, there were a few reasons why platinum prices had dropped, and mostly these were vehicle-related; in the universe of catalytic converters, there is another metal that is competing in their use, which is palladium. Also, platinum is used mostly in diesel engines while palladium is in petrol-powered vehicles. With the statistics (based on a few studies) of diesel vehicles emitting more CO2 than petrol ones, the heightened awareness of climate change, and the accelerated adoption of electric vehicles, platinum had seen its functions reduced.

 

Now comes the question: does platinum earn a place in The Bedokian Portfolio’s commodities portion?

 

Going Back To The Basics

The basic premise of having different asset classes within The Bedokian Portfolio is the reduction of risks, and this is achieved via diversification and its related concept, correlation. The commodities asset class, as described in my eBook, is good to own in times of high inflation or hyperinflation, and a safe haven during economic crisis due to its low or negative correlation with equities and bonds, thus as a form of insurance.

 

With this, let us have a look at the correlations between platinum and the other commodities for The Bedokian Portfolio (gold, silver, oil), and other asset classes using their respective ETFs (see Figure 2):

Name	Ticker	PPLT	GLD	SLV	BNO	VT	BND	VNQ	CASHX
abrdn Physical Platinum Shares ETF	PPLT	1.00	0.56	0.70	0.35	0.37	0.02	-0.05	0.19
SPDR Gold Shares	GLD	0.56	1.00	0.86	0.04	0.20	0.57	0.06	0.32
iShares Silver Trust	SLV	0.70	0.86	1.00	-0.02	0.19	0.32	-0.17	0.13
United States Brent Oil	BNO	0.35	0.04	-0.02	1.00	0.17	-0.30	0.19	0.06
Vanguard Total World Stock ETF	VT	0.37	0.20	0.19	0.17	1.00	0.48	0.54	0.12
Vanguard Total Bond Market ETF	BND	0.02	0.57	0.32	-0.30	0.48	1.00	0.50	0.04
Vanguard Real Estate ETF	VNQ	-0.05	0.06	-0.17	0.19	0.54	0.50	1.00	-0.15
Cash	CASHX	0.19	0.32	0.13	0.06	0.12	0.04	-0.15	1.00

 

Fig.2: Correlation (based on annual returns) between platinum, gold, silver and oil, equities, bonds, real estate investment trusts and cash, using their respective ETFs PPLT, GLD, SLV, BNO, VT, BND, VNQ and CASHX, Jan 2011 to Dec 2023. Jan 2011 was selected to be the start date as PPLT was incorporated in 2010. Source: Portfolio Visualizer.

Looking at platinum’s correlation with the other major asset classes, the numbers were low with reference to equities, bonds and cash, and negative to real estate, so it qualifies to be a diversifying asset in a portfolio, like gold, silver and to a certain extent, oil. 

 

It Is All About Exposure

 

Truth be told, platinum was hardly seen by many investors as a hedge against inflation nor a safe haven, judging from the price movements over the years. If you had read enough financial news headlines, in times of crisis, gold was always mentioned first, as over the times it had been associated as such. The price movements of platinum were obvious; in Figure 1, during the Great Recession in 2008/2009 and COVID-19 in 2020, the price of platinum suffered huge drops, only recovering in the latter part of those periods.

 

Platinum prices going up in the later stages of a recession period was a typical characteristic of basic metals, like copper, which signalled the beginning of the next boom cycle. Although one could argue that silver and oil could have that characteristic since they also have industrial applications, for platinum 59% of its use were in just two fields: automotive (41.08%) and jewellery (18.12%)¹, and with the limitations stated in the first section of this post, they further exacerbated its use cases. 

 

On the other hand, silver’s uses were more spread out, and recent news had shown that it was the next go-to precious metal after gold. Same goes for oil with many uses and it is dominating the headlines recently.

 

Is Platinum Still Feasible?

 

Platinum is purportedly rarer than gold, as one source puts it that there are 30 times more gold than platinum on Earth, so by logic the price of gold would be subservient to platinum’s (at least for the most part as shown in Figure 1). However, the points highlighted above had seen the disadvantage of platinum over gold. Perhaps when the markets (and cultures) realise its rarity and begin a paradigm shift towards platinum, then that may be the time to consider it as part of commodities in one’s Bedokian Portfolio. As for now, I would not include it.

 

 

1 – Distribution of platinum demand worldwide in 2023, by end use sector. Statista. 19 Apr 2024. https://www.statista.com/statistics/271231/use-of-platinum/ (accessed 30 Apr 2024)