Rising inflation is spurring strong demand for precious metals as investors rush to hedge at least part of their portfolios against a potential market correction. In addition, the growth of industrial and manufacturing activities as part of the rapid macroeconomic recovery has generated additional demand for precious metals. This trend is expected to continue as the Fed has said it expects inflation rates to rise again.

The global precious metals market is expected to grow at a CAGR of 5.6% over the next six years.

While futures and options contracts are commonly used to trade precious metals, the higher risks and additional expenses of these contracts make ETFs a viable alternative. We believe that the lesser-known precious metal ETFs Aberdeen Standard Physical Platinum Shares ETF (PPLT), Aberdeen Standard Physical Palladium Shares ETF (PALL) and Sprott Junior Gold Miners ETF (SGDJ) are well positioned to generate strong returns in the months ahead. come.

Click here to view our 2021 Gold and Silver Industry Report

ETF Aberdeen Standard Physical Platinum Shares (PPLT)

PPLT tracks the spot price of platinum bullion (after deducting fund expenses) and holds physical platinum bullion in secure vaults located in London and Zurich. Priced against the London Platinum and Palladium Market (LPPM) specifications for ‘good delivery’, this ETF offers investors exposure to the metal beyond buying the shares of the few platinum miners, buying coins. individual or holding a platinum futures contract. The fund is designed for investors looking for an economical and convenient way to invest in platinum with minimal credit risk. PPLT has $ 1.46 billion in assets under management (AUM).

PPLT has an expense ratio of 0.60%, which is above the category average of 0.49%. PPLT closed Friday’s trading session at $ 97.51, 30.5% above its 52-week low of $ 74.75. The ETF has gained 27.5% in the past year and 11.9% in the past nine months. The ETF attracted $ 10.66 million in net inflows over the past month.

Of the 37 ETFs in the Precious Metals ETF group, PPLT is ranked No.17.

ETF Aberdeen Standard Physical Palladium Shares (SAIL)

PALL reflects the performance of the spot price of palladium bullion, less the operating expenses of the trust, and holds palladium bars in a secure safe in London. Priced against the LPPM specifications for ‘good delivery’, PALL is one of the few ways in which investors can gain exposure to the metal and invest with minimal credit risk beyond holding a contract at term on palladium. There are no pure palladium miners. The fund has $ 496.40 million in assets under management.

PALL has an expense ratio of 0.60%, which is above the category average of 0.49%. PALL ended Friday’s trading session at $ 231.17 and is currently trading 34.4% above its 52-week low of $ 172.06. The ETF has gained 29.7% in the last year and 4.2% in the last six months. Its net inflows amounted to $ 33.10 million in the past month.

PALL’s strong fundamentals are reflected in its POWR ratings. The ETF has a B rating for Trade Grade. It is ranked No. 20 in the same group.

Sprott Junior Gold Miners ETF (SGDJ)

SGDJ seeks to track the performance of its underlying index, the Solactive Junior Gold Miners Custom Factors Index. The index tracks the performance of small cap / junior gold companies located in the United States, Canada and Australia, whose shares are listed on regulated stock exchanges. The fund invests at least 90% of its assets in the securities that make up the underlying index. It has $ 137 million in assets under management. SGDJ’s principal holdings include Great Bear Resources Ltd., Skeena Resources Limited and Centamin plc.

SGDJ has an expense ratio of 0.50%, which is above its category average of 0.46%. The ETF has a stable environmental, social and government (ESG) perspective. It has an MSCI BB rating, which is based on a score of 4.02 out of 10. The ETF pays out $ 0.97 in dividends per year, which translates to a dividend yield of 2.2%. Its four-year average dividend yield is 0.7%.

SGDJ closed Friday’s trading session at $ 44.45 and is currently trading just 16.1% below its 52-week high of $ 52.98. The ETF has risen slightly over the past three months. ETF net inflows have amounted to $ 3.64 million in the past three months.

SGDJ’s POWR ratings reflect this promising outlook. The ETF has a B rating for Trade Grade. It is ranked # 24 in the Precious Metals ETF group.

Click here to view our 2021 Gold and Silver Industry Report

PPLT stock was trading at $ 99.10 per share on Monday afternoon, up $ 1.59 (+ 1.63%). Year-to-date, the PPLT has fallen -1.62%, compared to a 12.92% increase in the benchmark S&P 500 over the same period.

About the Author: Sweta Vijayan

Sweta is an investment analyst and journalist with a particular interest in finding market inefficiencies. She is passionate about educating investors so that they can be successful on the stock market. After…

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