Precious Metals
This sector involves the exploration and extraction of rare, high-economic-value metals like platinum and palladium, used for both investment vehicles and industrial catalysts.
Why it exists
Precious metals businesses (miners and refiners) extract and refine metals valued for rarity, durability, and financial/industrial uses.
Why it’s necessary
They provide stores of value (monetary and investment demand), components in jewelry, and specific industrial uses (electronics, catalysts).
Key components
Exploration and development
Mining and milling
Smelting and refining
Royalties and streaming companies
How to evaluate businesses
Assess reserve quality (grade, geopolitical risk), all-in sustaining costs, mine life, and capital needs. For gold/silver, also consider leverage to price and hedging. Streaming and royalty firms have different economics (asset-light, diversified, high margin).
How the industry could be improved
Better disclosure and governance, more responsible mining practices, improved community engagement, and more efficient refining and recycling. Technological tools can reduce exploration risk and environmental impact.