Precious Metals Portfolio Diversification: Gold, Silver, Platinum and Palladium

Precious metals have historically fulfilled a specific role in mixed portfolios: they perform well precisely when traditional asset classes — equities, bonds — come under pressure. However, the decision of whether to hold gold, silver, platinum or palladium, and in what proportion, requires systematic analysis.

Gold: The Core of Every Precious Metals Portfolio

Gold is the most liquid, most researched and most widely held precious metal. Its long-term correlation with equities is close to zero — in some crisis phases even negative. The World Gold Council estimates that a gold allocation of 5–15% in a mixed portfolio reduces the maximum drawdown by 2–4 percentage points without significantly reducing expected returns. Gold in CHF: currently around 115 CHF/gram; all-time high on 29 January 2026 at approximately 152 CHF/gram (5,595 USD).

Silver: Industrial Metal with Precious Metal Character

Silver combines two demand drivers: investment demand (similar to gold) and industrial demand (solar industry, electronics, medical technology). This makes silver more volatile than gold but also offers higher upside potential. The gold/silver ratio — currently around 60 — is near its historical average. Silver reached a yearly high of 121.64 USD on 29 January 2026 and currently trades at approximately 75 USD per ounce.

Platinum: The Undervalued Industrial Metal

Platinum historically traded at a premium to gold. Today platinum is cheaper than gold — a historically unusual constellation. The main demand driver is the automotive industry (catalytic converters) and increasingly the hydrogen economy (electrolysers). At around 960 USD per ounce, platinum offers a potentially attractive entry point for investors with a 3–5 year horizon.

Palladium: The Volatile Specialty Metal

Palladium is the most specialised of the four precious metals. Demand comes almost exclusively from gasoline catalytic converters. The shift to electric vehicles is a long-term structural headwind. Palladium has fallen from its all-time high of over 3,000 USD to currently around 960 USD. For diversification purposes, palladium is only conditionally suitable — for targeted speculation it may be of interest.

Recommended Portfolio Allocation

For a balanced precious metals portfolio: Gold 60–70% (core function: capital preservation); Silver 20–30% (growth component, higher volatility); Platinum/Palladium 0–10% (only for experienced investors, speculative component). Physical holdings should be supplemented by allocated storage or an ETF depending on investment size.