There are many kinds of metals in nature, but gold dominates the world by virtue of its noble status. As a metal, gold is made into gold ornaments or used in industrial products. Not only that, because of the eternal immutability of gold, its value is recognized by people, and it is treasured to preserve its value. This is also the essential difference between gold and other metals.

Gold is the most expensive precious metal

There are many kinds of metals, and among them, the most valuable are called precious metals. The metals of the gold, silver and platinum series are collectively referred to as precious metals. Platinum metals include platinum, palladium, rhodium, ruthenium, iridium, and osmium. Among them, platinum and palladium have a market that can be traded at any time, and the other four metals are only traded between professional companies or directly traded between manufacturers and customers.

In the New York and Tokyo futures markets (terms: New York Mercantile Exchange and Tokyo Mercantile Exchange), gold, silver, platinum, and palladium can be traded. Therefore, the precious metals referred to in the industry usually refer to these four types. Of course, the representative of precious metals is none other than gold. As of August 2019, gold is still the most expensive precious metal.

Small in size and easy to maintain its value

It is rare in the world to calculate the value in grams. For example, the price of Japanese premium Wagyu beef is about a few hundred yuan per 100 grams. Compared with the 490,000 gold per 100 grams, it is still far from the dust. The small, expensive, pocket-sized body holds huge value, and this feature has pushed up the price of gold.

Fluctuating gold prices

The value (= price) of gold changes every moment. Calculated in RMB, the price of gold in 2000 was 80 RMB/gram, and in 2019 it rose to 350 RMB/gram, which has more than quadrupled. It can be seen that the price of gold is not absolute and unchanging, but is based on market conditions relatively and at different times.

Gold is used to preserve value

Not only the gold that is actually needed but also used to preserve its value.

What are the uses of precious metals? Silver is mainly used for photographing film, switches and fuses and other electrical equipment, solder, antibacterial products, jewelry, silverware, coins, etc. Platinum is mainly used in automobile exhaust purification catalysts and jewelry. Palladium is used to make automotive catalytic converters, jewelry, electronics and dental materials.

Gold is also used as a metal in jewelry and industrial products. But its more important feature is that it is treasured by people from all walks of life as an asset. The biggest difference between gold and other metals is that gold is not only used in industry, but also in value preservation.

Among the precious metals, only gold has a special demand structure. As mentioned earlier, the demand for silver, platinum, palladium, and other industries is large, accounting for 80% of the total demand. Gold is on the contrary, 80% of total demand comes from investment and jewelry. In other words, 80% of gold demand is irrelevant. No jewelry and gold bars are not life-threatening. However, other precious metals whose industrial uses account for 80% of the total demand are necessary. Once lacking, it is impossible to manufacture automobile exhaust purification catalysts, electronic materials, etc. So in terms of actual value, other precious metals are much higher than gold.

However, the high demand for investment shows that gold has been with people for thousands of years, and its eternal immutability is recognized by people and used to maintain its value. Silver is too cheap compared to gold. Platinum is now on a par with gold, but the market size is only one-twentieth of that of gold. If it is used as a hedge, the liquidity is too small. In addition, platinum’s practical needs will also consume it. Gold has perfect liquidity, perfect value, and just right scarcity, making it the most ideal precious metal.

See other Gold related articles