Gold 0.21%
£3,218.51 OZ
Silver -2.37%
£48.73 OZ
Platinum -0.49%
£1,359.98 OZ
The Silver Britannia is capital gains tax free in the UK, making is a very popular choice with UK investors
See All
When investors look at precious metals markets, gold and silver usually dominate the conversation. Yet the long history of trading between platinum and palladium offers an equally fascinating—and highly telling—story. By analyzing their historic ratio, we can see that platinum today is trading at levels that appear deeply undervalued compared to palladium.
From January 1985 through September 2025, the median ratio of platinum to palladium was 2.46. In other words, throughout this four-decade period, it typically required about two and a half ounces of platinum to equal one ounce of palladium in value. Deviations from this median have historically signaled major market dislocations, and they have often been followed by powerful corrections back toward the long-term norm. The current ratio sits well below that median, which suggests that platinum is priced at a major discount and could have significant upside potential.
The platinum-to-palladium ratio has always reflected the shifting balance of demand, supply, and investor sentiment between the two metals. In the mid-1980s, platinum firmly held the upper hand. Its rarity, higher mining costs, and strong industrial appeal positioned it as the premium metal, often trading at several multiples of palladium’s price. The years that followed would showcase just how dominant platinum was during this early phase of the ratio’s history.
In January 1985, the platinum-to-palladium ratio was recorded at 2.19. This meant that platinum already commanded a meaningful premium over palladium, reflecting its scarcity, higher production costs, and perceived industrial value. Within just a few months, momentum began to build further in platinum’s favor.
By August 1985, platinum had gained significantly against palladium, pushing the ratio up to 3-to-1. The rally did not stall there; by August 1986, just a year later, the ratio had reached 4-to-1. This surge highlighted how strongly markets favored platinum, cementing its role as the more valuable of the two metals during this period.
The upward trend culminated in January 1991, when the ratio briefly pierced the 5-to-1 level. For a short time, five ounces of platinum were valued the same as just one ounce of palladium. This marked a moment of extreme relative valuation, underscoring platinum’s dominance and signaling a potential imbalance in the relationship between the two metals.
By the early 2000s, tightening emission standards around the world sparked a surge in palladium demand for catalytic converters, especially in petrol engines. Platinum, once dominant in diesel vehicles, began to lose ground.
The platinum-to-palladium ratio dropped sharply — from around 4-to-1 in the late 1990s to nearly 1-to-1 by 2001. For the first time in decades, the two metals traded near parity, marking the end of platinum’s long-standing supremacy.
During the 2008 financial crisis, investors fled industrial metals for safe havens like gold. Platinum’s price collapsed by more than 60% within months, reflecting its strong tie to manufacturing and automotive output. The gold-to-platinum ratio, which had historically favoured platinum, inverted dramatically — gold became more expensive. This was a psychological shift in the market that still echoes today.
The aftermath of the Dieselgate scandal dealt another blow. As carmakers phased out diesel engines, palladium demand soared while platinum demand stagnated. The platinum-to-palladium ratio fell below 0.5-to-1 — meaning palladium was twice as expensive as platinum. This imbalance was historically unheard of, and largely driven by short-term regulatory and consumer trends rather than fundamental scarcity.
As supply chains tightened and substitution began, industries started switching back to platinum. Automakers discovered they could replace a portion of palladium in catalytic converters with platinum without compromising performance. At the same time, investment demand for platinum ETFs and bars rose, as value investors recognised the deep discount.
Today, both the platinum-to-palladium and gold-to-platinum ratios remain far outside historical norms. Gold continues to trade at nearly double the price of platinum, while palladium’s once-dominant premium has faded. Historically, such distortions correct themselves as markets rebalance.
The ratios now both point to one conclusion: Platinum is deeply undervalued.
With tightening mine supply, renewed industrial use, and long-term strategic demand from the hydrogen economy, platinum’s comeback is not a question of if, but when.
Investing in Silver
Silver coins offer investors a tangible, low-barrier way to participate in precious metals, combining affordability with intrinsic value. They also provide liquidity, global recognition, and potential upside in both safe-haven demand and industrial growth
