Palladium in a Self-Directed IRA

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Despite the IRA eligibility of platinum and palladium, gold and silver remain particularly popular among precious metals IRA investors. Meanwhile, the somewhat forgotten metals—especially palladium—have flown under the radar as viable assets in self-directed IRAs.

There’s already a marketplace for palladium bullion products, but the metal took another familiar form a while back. The American Eagle coin, a prominent and relatively trusted “brand” in the precious metals community, was made available to palladium investors on September 25, 2017. The first ever Palladium American Eagle featured one ounce of .9995 fine palladium and therefore meets the minimum purity requirement for IRA eligibility.

Like gold and silver, palladium derives a fair share of its value from industrial applications. The chemical element is used to manufacture catalytic converters for automobiles, dental fillings, and jewelry (a gold-palladium alloy can produce quality white gold). As of this publication, the spot value of palladium was sitting at about $1,360.00 per ounce. When compared to the $375.00-per-ounce value of 2007 and the $700.00-per-ounce value of 2012, palladium has performed well over the years. Successful long-term assets characterize a strong financial strategy, so the overall growth of palladium during the last decade may warrant consideration from IRA investors (although past performance is no guarantee of future results).

It’s worth noting that the palladium market has exhibited a higher degree of volatility than those of gold and silver. After reaching $900.00 per ounce in 2015, palladium fell to $500.00 in 2016 before bouncing back. The correction was just as swift as the drop, but those may have been tense months for anyone who monitored palladium prices on a daily basis. In this regard, palladium mirrors the main securities indexes by sustaining drop-offs from time to time. However, unlike stocks or mutual funds, physical assets tend to consistently bear value as investments, commodities, and sometimes even as currency. Traded shares, on the other hand, will always carry the risk of becoming worthless.

As with any investment approach, diversifying one’s portfolio can go a long way toward promoting financial success down the road. The incorporation of alternative investment options like precious metals—with palladium as a seldom considered but perfectly valid option—can help self-directed investors achieve this. For more information about investing in precious metals with your self-directed retirement plan, please don’t hesitate to contact our Precious Metals Asset Team at pmat@ndtco.com or 877-742-1270 (Ext. 185).

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