Platinum Bonds to Beat Gold Producers’ Debt in 2014

Bloomberg reported that according to Momentum Asset Management (Pty) Ltd., the bonds of South African platinum companies are likely to outperform the debt of gold producers in 2014. That’s largely because prices for the two metals are going in opposite directions.

As quoted in the market news:

The bonds of Impala Platinum Holdings Ltd., which rallied in the second half of last year, may beat those of AngloGold Ashanti Ltd. and Gold Fields Ltd., said Simon Hudson-Peacock, a money manager at Momentum. Implats stock will also do better, he said. Platinum prices will rise as much as 15 percent by the fourth quarter, while bullion will fall 2.2 percent, according to surveys of analysts compiled by Bloomberg.

‘I would be favoring platinum equities and bonds over gold equities and bonds,’ Hudson-Peacock, who helps manage the equivalent of $31.2 billion in Johannesburg, said by phone on Jan. 6. ‘I see world economic growth being moderate but gaining momentum, in which case there will be less reason for gold as a hedge and more reason to buy platinum as an industrial metal.’

Click here to read the full Bloomberg report.