A beginner’s guide to palladium: Price, uses & market overview

Explore a thorough overview of the palladium market, learn how it works in simple terms and get to grips with its significance as a popular global commodity.
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Updated: Jun 5, 2024
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On this page, we explore everything you need to know about palladium. Gain insights into palladium market trends, pricing mechanisms, and the environmental impact of palladium. 

Read on to learn more about this popular commodity and find links to beginner friendly guides explaining how you can get involved in palladium. 

What is palladium?

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Palladium is a durable white precious metal that isn’t as well known as gold or silver, but it is actually more valuable. First discovered in the early 1800’s, palladium shares many chemical properties with its platinum cousin. Palladium is less dense and has a lower melting point compared to platinum. 

This unique combination of properties has resulted in palladium becoming one of the most sought-after commodities across various industries. While it has many uses, its most significant application lies in catalytic converters, which help reduce harmful emissions from gasoline-powered vehicles. 

Besides its use in the automotive industry, palladium is often found in electronics, the dental industry, and even jewellery. With such a diverse range of uses across various industries, palladium has emerged as a compelling commodity for investors seeking exposure to the precious metals market. 

Palladium market overview

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Palladium offers a unique opportunity for retail traders to participate in the precious metals industry. Unlike similar metals, where physical ownership is one of the primary methods of investment, palladium is mainly traded through derivative instruments. 

Most online retail traders typically access the palladium market by using an online broker which offers contracts on futures exchanges or Contracts for Difference (CFDs). Exchanges like the Chicago Mercantile Exchange (CME) offer standardised palladium futures contracts. Each contract represents a set amount of palladium, usually 100 troy ounces. 

The palladium market has had its ups and downs over the years. It took off in 2016 and rallied nearly 600% over the following 5 years. However, since then it has been a different story and the price of palladium has fallen close to 70%. 

Is palladium valuable? 

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Yes, palladium is a valuable commodity and there are numerous reasons why investors are attracted to the market. We have highlighted some of these key fundamentals below, explaining what they are and why they matter.

  • Rarity. Palladium is a much scarcer material than other precious metals such as gold, and increased demand in recent years has led to supply struggling to keep up. This has made the precious metal attractive to both institutional and retail investors. 
  • Store of value. If you want to store some of your wealth outside of the banking system, palladium tends to hold its value well. While it may not have quite the safe haven status of a material like gold, it remains a popular choice for value storage.
  • Versatility. Palladium is perhaps the most useful precious metal, being used for autocatalysts, electronics, dentistry, medicine, chemical applications, jewellery, groundwater treatment, solar energy and fuel cells. This diverse array of uses means palladium is always in high demand, especially when the economy is healthy.

How to invest in palladium

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You can invest in palladium by using a commodity trading platform. These platforms offer a range of commodities and are very easy to use. There are different platforms suitable for specific requirements. You can even use the best palladium brokers for a more specialised approach. 

Some let you buy physical palladium, others let you trade palladium, and many are designed for investing in the metal. Visit our dedicated guide to discover how to invest in palladium.

Palladium in your investment portfolio

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A diverse investment portfolio can help protect you during market uncertainty, and the inclusion of palladium can add value while allowing you to spread your money across various markets. 

Palladium often moves independently to traditional investments like stocks and bonds. You can include palladium in your portfolio as a hedge against potential losses. During times of economic uncertainty, investors view commodity grains such as palladium as attractive options. 

Palladium vs other commodities

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Palladium is part of the precious metals family of commodities, including gold, silver, and platinum. Each commodity is unique in its own way and offers different features for investors and traders. You can learn more about specific precious metals using our dedicated guides below. 

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Prash Raval
Financial Writer
Prash is a financial writer for Invezz covering FX, the stock market and investing. For over a decade he has traded spot FX full time while... read more.