Costco began selling 1-ounce gold bars late last year. While this was restricted to members of Costco, analysts at Wells Fargo estimate that the popular retailer sells between $100 million to $200 million in gold bars monthly. Now members of Costco can also purchase one-ounce bars of platinum at $1089.99.
Platinum’s value has risen by 15% since last year, with its demand growing significantly. The silvery-white metal is resistant to corrosion, just like gold. It has many different uses, among them its use in catalytic converters for trucks, cars, and buses. This use makes up 50% of its annual demand. Platinum is effective at converting emissions produced from a car’s engine into less harmful waste products.
The electronic industry uses the metal in thermocouples and computer hard disks while the medical sector uses compounds of the metal as chemotherapy medications for cancer treatment. Platinum is also used in the manufacture of LCDs, optical fibers, spark plugs, turbine blades, dental fillings, and pacemakers.
One may be surprised to learn that platinum-cured mixtures of silicone are used in different personal care products, including contact lenses, shampoos and lipsticks. In addition to this, the metal is extensively used for jewelry.
One senior research analyst for Capital Markets, Kelly Bania, stated in an interview that Costco’s new offering wasn’t surprising. Bania added that the retailer was offering some of the best margins on the metal.
Other retailers selling platinum bars include Walmart, which is selling a one-ounce bar of platinum for almost $1132.28. The demand for Costco’s platinum and gold bars continues to grow, with latest data showing that the value of one ounce of gold currently stands at almost $2667.80. This is higher than the $2359 used by Humphrey Yang, who is a personal finance content creator, to purchase a 1-ounce gold piece earlier this year.
In a video post on Instagram, Yang explained that since gold held value, he didn’t really view the purchase like an expense but as converting one currency to another.
The increasing popularity of precious metals promises a boost for retailers like Costco. However, it is important to keep in mind that the prices of these metals can fluctuate. Similar to other investments, nothing is guaranteed, which is why its important to diversify one’s investment portfolio.
Any individual who’s thinking about investing in precious metals should conduct their own research and examine the kind of value they’ll be getting from these retailers.
With gold and other precious metals now available to ordinary consumers at retailers like Costco, entities like Aston Bay Holdings Ltd. (TSX.V: BAY) (OTCQB: ATBHF) engaged in gold exploration and extraction can expect the market for their products to be even more massive than has been the case in recent times.
NOTE TO INVESTORS: The latest news and updates relating to Aston Bay Holdings Ltd. (TSX.V: BAY) (OTCQB: ATBHF) are available in the company’s newsroom at https://ibn.fm/ATBHF
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