Although it is less commonly talked about than gold and silver, platinum is nonetheless an important precious metal. In addition to being prized by many investors, platinum is also widely used in manufacturing products such as cars, jewelry, and electronics. Investors can gain exposure to platinum in various ways, such as by buying platinum bars or coins, or investing in shares in platinum mining companies. Another option available to investors is to purchase shares in an exchange-traded fund (ETF) that holds physical platinum. This method can be beneficial to investors who desire a liquid investment and do not wish to pay storage and insurance costs.

There are two main types of platinum ETFs for investors to choose from. The first are structured as grantor trusts, which means that the fund holds physical bullion in its vaults and then administers the buying, storage, and sale of that bullion on behalf of the trust’s owners. Investors who purchase shares in a platinum ETF are therefore effectively buying a small fraction of this larger portfolio of platinum bullion.

The other common structure is what’s called an exchange-traded note (ETN). These products are unsecured debt securities that track an underlying index and trade on a major exchange in the same manner as a stock. Platinum ETNs invest in futures contracts that track the price of the metal, as opposed to holding it in physical form. Since the underlying purpose of most platinum ETFs and ETNs is simply to track the spot price of the physical metal, the performance of these funds will often be relatively similar. However, performance differences can arise due to factors such as tracking error, different fund management methodologies, and unequal expense structures.

If we exclude inverse and leveraged ETFs, there are currently only three platinum ETFs for investors to choose from. Among them, the best-performing option over the past year is the Aberdeen Standard Platinum Shares ETF (PPLT). In what follows, we will examine all three of these funds, using figures retrieved on May 13th, 2020.

Aberdeen Standard Platinum Shares ETF (PPLT)

  • Performance over 1-Year: -10.9%
  • Expense Ratio: 0.60%
  • Annual Dividend Yield: N/A
  • 3-Month Average Daily Volume: 174,824
  • Assets Under Management: $583.8 million
  • Inception Date: January 6, 2010
  • Issuing Company: Aberdeen Standard Investments

The Aberdeen Standard Platinum Shares ETF (PPLT) is a grantor trust, meaning it stores physical platinum in its vaults on behalf of its investors. Its goal is to track the spot price of platinum, after deducing the fund’s expenses. The funds vaults are located in Zurich, Switzerland and in London, UK.

GraniteShares Platinum Trust (PLTM)

  • Performance over 1-Year: -11.3%
  • Expense Ratio: 0.50%
  • Annual Dividend Yield: N/A
  • 3-Month Average Daily Volume: 41,197
  • Assets Under Management: $7.6 million
  • Inception Date: January 22, 2018
  • Issuing Company: GraniteShares

The GraniteShares Platinum Trust (PLTM) is also structured as a grantor trust, physically holdings platinum bullion on behalf of its investors. Its vault is located in London, UK, and is inspected twice per year. The goal of the fund is to provide a cost-effective way to invest in platinum, by tracking the price of the platinum spot market, less the fund’s expenses.

iPath Series B Bloomberg Platinum Subindex Total Return ETN (PGM)

  • Performance over 1-Year: -11.7%
  • Expense Ratio: 0.45%
  • Annual Dividend Yield: N/A
  • 3-Month Average Daily Volume: 827
  • Assets Under Management: $3.5 million
  • Inception Date: January 17, 2018
  • Issuing Company: Barclays Capital

The iPath Series B Bloomberg Platinum Subindex Total Return ETN (PGM) is unique on this list in that it is only fund structured as an ETN. This means that rather than holding physical platinum in a vault, it instead invests in platinum commodity futures contracts. Despite this methodological difference, the core objective of the fund is the same: tracking the spot price of platinum after accounting for the fund’s expenses. Be careful, due to this ETN's extremely low trading volume, you're more likely to have higher trading costs than with more liquid investments.