Question 1

What is the Platinum to Palladium ratio?

Accepted Answer

The Platinum to Palladium ratio measures how many units of Palladium it takes to buy one unit of Platinum. It's calculated by dividing the Platinum price by the Palladium price. For example, a ratio of 2 means you need 2 units of Palladium to buy 1 unit of Platinum.

Question 2

What is the historical average Platinum/Palladium ratio?

Accepted Answer

The long-term historical average Platinum/Palladium ratio is approximately 2:1. The all-time high was 6:1 and the all-time low was 0.25:1. Both are used in catalytic converters. A low ratio suggests platinum may be undervalued as a substitute for palladium.

Question 3

How can I use the Platinum/Palladium ratio for investing?

Accepted Answer

Traders use this ratio to determine relative value. When the ratio is significantly above the historical average of 2, Palladium may be undervalued relative to Platinum. When below average, Platinum may be the better value. Some investors swap between the two metals based on ratio extremes.

Platinum / Palladium Ratio

Frequently Asked Questions

What Does This Ratio Mean?