Palladium vs. Gold: Which Is the Better Investment?

David vs. Goliath. Ali vs. Foreman. USA hockey vs. Russia. 

Sometimes, what seems to be a mismatch turns out to be a fair fight. 

Such is the case with palladium vs. gold. 

Palladium, gold’s lesser known precious metals cousin, has had plenty of time to shine. But how does it compare to gold as an investment?

This guide will look at both metals. We will delve into their histories, past performance, and current performance. 

Our goal is to help you make a good decision. Let’s get started.

What Is Palladium? 

Palladium is a shiny, silvery white precious metal. 

Palladium is 30 times rarer than gold and may be the least known primary precious metal. Despite the lack of public awareness, it has, at times, been the most expensive of the primary precious metals (gold, silver, platinum, palladium).

Similar to its precious metals cousins, palladium can hold an important place in an investment portfolio. You can use it as a store of value and speculative investment. 

Investors typically make their play in physical palladium by purchasing coins and bars. The U.S. Mint offers palladium coinage, and some of the finest refineries make palladium in bar form. 

Palladium is an IRA-approved precious metal. That means investors with self-directed individual retirement accounts can own physical palladium in their IRA. Palladium bars and coins must meet the following standards to be IRA-eligible:

• Bars and coins must be at least 99.95% pure.
• Coins must be government-minted, uncirculated, and in perfect physical condition.
• Bars can only originate from approved assayers and refiners, all of which are traded on public exchanges such as the COMEX.

Cash-based investors buy palladium bars and coins and have them direct-delivered to their doorstep. There are no eligibility requirements outside of availability and budget. 

What Is Gold? 

Gold is a rare, shiny yellow precious metal. 

Revered since the time of ancient civilizations, gold’s value lies in its beauty, density, malleability, and non-corrosiveness. 

Gold is currently the most expensive of the primary precious metals.
Investors use gold as a long-term investment because it can offer:

• Inflation protection
• A store of value
• Portfolio diversification
• No counterparty risk

Direct-delivery investors and collectors choose their desired bars and coins and have them delivered. 

IRA and eligible 401(k) owners can transfer or roll over their current plans into a Gold IRA. The Gold IRA rollover is a tax-free and penalty-free process. 

The Gold IRA includes gold products that meet the following requirements:

• Bars and coins must be 99.5% pure.
• Coins must be government-minted, new, uncirculated, and in perfect physical condition.
• Bars must originate from approved companies publicly traded on exchanges such as the COMEX.

Palladium vs. Gold: Investment Comparison 

Comparing the investment value of gold vs. palladium requires a deep dive into the characteristics of each metal. 

Let’s explore some factors that can help you decide which metal will help you reach your investment goals. 

Price 

Comparing the price of palladium vs. gold reveals the two metals moving in opposite directions.

Palladium reached its all-time high of $3,440 per ounce in March 2022. At that time, gold traded near $2,000 per ounce. 

Since that time, palladium has lost its luster. In the last 18 months, the price of an ounce of palladium has fallen below $1,200. 

Meanwhile, gold has held steady, currently trading at more than $1,900 per ounce. 

Applications 

Palladium is a catalyst that speeds up chemical reactions. A prominent material in catalytic converters, palladium is instrumental in turning atmospheric pollutants into less harmful water vapors and carbon dioxide. 

Palladium is also used in:

• Coinage
• Dentistry
• Fuel cells
• Jewelry
• Groundwater treatment

It is malleable, making it easy to shape and work with. But palladium hardens and strengthens as it cools to room temperature. 

Gold’s primary uses are as jewelry, coinage, and investment. But it has industry ties as well, featuring in connectors, relay switches, and connection strips. 

Gold is the most malleable of the precious metals. It is non-corrosive and highly conductive. 

Future Market Trends and Speculations

The palladium market has softened. Demand for palladium has fallen, taking the price of the precious metal down with it. 

Experts attribute it to the emergence of electric vehicles (EV) in China and the U.S. EVs do not need catalytic converters because there are no harmful gas emissions to clean. 

Expanded production of heavy-duty vehicles that use platinum for their catalytic converters may also be to blame. 

Gold demand remains brisk. 

High interest rates, geopolitical strife, and inflation keep investors looking for a safe haven to protect their wealth. 

U.S. unemployment sits near record lows, and job creation numbers continue to astound. The machine is churning—money is being made and spent. 

Electronics that use gold still fly off the shelves, and the gold vs. palladium battle seems to favor gold. 

Some may consider palladium on sale at these price levels. Many consider it a great time to invest when the market ebbs. As such, many investors consider taking a position during price dips and riding the flow as it hopefully goes up. 

Gold seems to never go out of style. Current levels may indicate a new floor for the king of precious metals. If conditions remain the same, it is reasonable to expect gold will continue to perform. 

Pros and Cons of Investing in Gold vs. Palladium 

Understanding the strengths and weaknesses of gold and palladium can help you decide which is right for you. It might be both.

Let’s take a look at the advantages and disadvantages of each.

Investing in Palladium Advantages and Drawbacks 

Pros of Investing in Palladium

• Palladium is rare. It is 30 times rarer than gold and mined in only a few places across the globe.
• Palladium is in a different asset class than paper-based investments. It can truly diversify a portfolio.
• The automobile industry relies on palladium. 

Cons of Palladium Investing

• Palladium prices can be volatile. Its main industrial use is in the auto industry, which pegs its fate to the “continuation” of gas powered vehicles  and catalytic converters.
• Low consumer demand for palladium may result in liquidation difficulties. 

Investing in Gold Advantages and Drawbacks 

Pros of Investing in Gold

• Gold is recognized worldwide, making it easy to liquidate. You can sell your bars and coins in almost any country and amid almost any geopolitical or economic conditions.
• Gold can hedge against inflation. It tends to retain value during periods of high inflation and dollar devaluation.
• Gold diversifies your portfolio. It is non-correlated to stocks and other paper-based assets. Gold tends to perform well when paper-based investments are failing.

Cons of Gold Investing

• You must safely store and insure your gold. This brings additional costs, such as purchasing a safe or renting space in a vault or safe deposit box. 
• Gold’s price can fluctuate and, at times, be volatile. 
• Gold does not pay a dividend or generate interest. Its value is supply and demand-oriented, moving as public interest and sentiment shifts. 

Should You Invest in Palladium or Gold? 

We’ve just learned that all precious metals are not created equal. 

Gold and palladium may belong to the same family, but in the battle of palladium vs. gold, gold is winning. 

The reigning king of precious metals has more industrial and investment uses, is easier to liquidate, and has a longer history of data. 

Palladium still deserves serious consideration. It can diversify a portfolio and has speculative potential. 

The account executives at Advantage Gold are awaiting your call. We will walk you through your gold and palladium options and show you how easy it is to own both. 

We’re here to educate and walk you through the process of precious metals ownership. 

Click the link and tell us how to contact you. You’ll be glad you did.