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Forget gold, time to buy searing hot 'white metals'

Pras Subramanian

While gold has been climbing higher recently as investors seek safety due to the deteriorating conditions in northern Iraq, the ‘white metals’ as they are called have been searing hot.

Palladium is near five-year highs after tailing off a smidge, and platinum's been on fire the past few months. The prescient Jonathan Hoenig of the Capitalist Pig Hedge Fund was on Breakout two months ago, banging the table telling viewers to buy these metals. In the attached video, he says the trade’s still on and you still have time to play it.

“Strength begets strength, not only in higher prices for white metals, but base metals and industrial metals almost across the board,” he says in the attached video. “Palladium and platinum… show tremendous, relative out-performance even as the more popular metals gold and silver seem to languish.”

Just like bar-hopping, Hoenig says investors need to go where the action is, and he sees the action in white metals staying strong. One of the reasons why Hoenig is bullish on Palladium is Russia, specifically the instability there. “The continuing escalations in Russia [is bullish for white metals]; Russia is a major exporter of Palladium and to a lesser extent platinum exporter.”

But another big reason why to get behind this trade is the strengthening U.S. and world economy. “The seemingly uptick in the U.S economy and industrial growth as well, as the world’s economy begins to heat up you also see the industrial metals start to heat up.”

Hoenig’s favorite plays in this space are the ETFS Palladium Shares (PALL) and the ETFS Platinum Shares (PPLT).

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