NEW YORK (TheStreet) -- The ETFS Physical Palladium Shares ETF (PALL) - Get abrdn Physical Palladium Shares ETF Report offers investors exposure to palladium, a metal that should see its price boosted by increased demand from global automakers and global supply issues.
Palladium, similar to its much more expensive sister platinum, is used in vehicle exhaust catalysts to control emissions. Demand for palladium is expected to be supported by a recovery in automotive sales -- notably in Asia -- as well as the passage of stricter emissions regulations in Europe.
On the supply front, production issues have started to emerge in the world's second largest producer of palladium, South Africa. There is inadequate investment in infrastructure, and deadly accidents and safety issues have increased the possibility that the government will pass more restrictive mining legislation. To further add to the supply woes, palladium stockpiles in Russia, the world's largest producer of the metal, are diminishing.
In a nutshell, the supply for palladium is not expected to keep up with demand, resulting in positive price support for the metal. An easy way to gain access to the metal is through the
ETFS Physical Palladium Shares ETF
, which seeks to track the price performance of palladium bullion.
-- Written by Kevin Grewal in Houston.
At the time of publication, Grewal had no positions in securities mentioned.
Kevin Grewal is the founder, editor and publisher of
ETF Tutor and serves as the editor at
www.SmartStops.net, where he focuses on mitigating risk and implementing exit strategies to preserve equity. Additionally, he is the editor at The ETF Institute, which is the only independent organization providing financial professionals with certification, education, and training pertaining to exchange-traded funds (ETFs). Prior to this, Grewal was a quantitative analyst at a small hedge fund where he constructed portfolios dealing with stock lending, exchange-traded funds, arbitrage mechanisms and alternative investments. He is an expert at dealing with ETFs and holds a bachelor's degree from the University of California along with a MBA from the California State University, Fullerton.