Investment Strategies
Cyclical Commodities Continue To Attract Investors - ETF Securities

Investors are continuing to buy more cyclical commodity
exchange-traded products such as silver, platinum and palladium,
whereas their appetite for gold is weakening, research from
ETF Securities has found.
Last week investors withdrew $157 million from gold ETPs,
bringing the monthly outflow to $419 million, following the fall
in the price of the yellow metal earlier this month. Despite
strong demand in the physical coin, bullion and jewellery
markets, gold ETP holders are continuing to sell.
“The 15 per cent fall in prices experienced between 12 and 15
April has brought out bargain-hunters in the physical market,”
ETF Securities said.
In contrast, investors are more attracted to cyclical precious
metals. The ETFS Palladium Trust received inflows of $19.8
million, the largest since February 2012, while the ETFS Physical
Platinum vehicle gained $8.7 million.
Long silver ETPs also saw a seventh consecutive week of inflows,
with $5.3 million reported last week, and the metal may now be
seen as offering a potentially attractive entry point for
investors given the fall in net long speculative positions in
recent months.
“Increasing demand for platinum group metals from the jewellery
and autocatalyst sectors in emerging markets and the US, combined
with ongoing supply concerns are likely to keep the metals in a
supply deficit this year,” the firm added.
Similarly, outflows from long copper ETPs were their highest on
record last week at $140 million following strong inflows most of
this year. Investors took profit on the recent price bounce which
saw a 2.7 per cent price increase last week.