I am glad to welcome my readers again! Precious metals are an asset that always remains valuable and even rises in price during crises and cataclysms, which cannot be said about money. But it comes with many inconveniences. You need to store the bullion somewhere (some are still buried in dachas), but it won’t be possible to sell it today even in case of urgent need. Fortunately, information and banking technologies provide us with an alternative.
The compulsory medical insurance rate at Sberbank today is an unstable thing. Today gold falls in price, tomorrow it rises in price - it seems that it is too late to buy it, because yesterday it was cheaper. But what if in a week it will cost 30% more?
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Theoretically, you can buy metal blindly and wake up a billionaire the next morning. In practice, very few people in history have succeeded in doing this. If we want to save money and increase it, it is worth familiarizing ourselves with exchange rate fluctuations and their dependence on the state of the world economy.
Gold
Despite periodic ups and downs, the gold rate is growing steadily. Since 2000, its cost per troy ounce has increased from 300 US dollars to more than 1,000, rising to almost 2,000 in 2012.
Silver
Some experts consider silver to be an undervalued metal. There is actually much less silver on the market than has been mined in the history of mining. This is due to the fact that most of it is used for industrial needs. Nevertheless, silver today is included in the list of precious metals and is also considered a profitable investment.
Palladium
Palladium is a metal needed by the mechanical engineering industry. Its center in Russia is Chelyabinsk and the Chelyabinsk region. Demand for it is stable, because even in times of historical turning points, people need cars, machine tools, electronics and medical equipment. All this means that there is no need to fear a depreciation.
Platinum
Platinum is the rarest of the four investment metals and the three that perform a monetary function (palladium coins appeared only in 1966 and were not in active circulation). In 2015, at the peak of its value, it was more expensive than gold. However, those who did not cash out their platinum accounts in hopes of future growth were mistaken: the growth was followed by a sharp decline. Nevertheless, today platinum is more expensive than before 2015.
Industrial area
50% of the metal is used in the automotive industry to produce catalysts that reduce exhaust emissions. In addition, 20% is used in instrument making. If demand for industries that use palladium is reduced, the value of this metal will decrease.
But things could be completely different. Society is looking for alternatives to internal combustion engines. After all, what if you can fill the tank with plain water. In fact, everything has already been invented a long time ago, only these discoveries are devalued by the most powerful oil structures that buy up patents and destroy them.
To produce fuel devices, palladium is needed. Most likely, society will switch from oil to pure hydrogen, and palladium will become more popular. This will allow the price of this metal to increase several times. And the most important thing is that most palladium is found in Russia.
Dynamics in recent years
By 2022, experts predicted an increase in the price of metal assets, linking the increase in the exchange rate with the aggravation of the trade confrontation between China and the United States. By mid-2022, this war reached its climax - both states imposed duties on the import of goods, the amount of which amounted to billions. The conflict has not yet been resolved; negotiations on the situation are ongoing.
Contrary to forecasts, all metals fell in price, and the owners of compulsory health insurance felt this for themselves. Perhaps the reason is that the dollar has strengthened in the global foreign exchange market.
If we take statistics over the last 10 years (from 2009 to today), we will see that all metals have risen significantly in price, despite repeated drops and increases in exchange rates, sometimes sudden and large. See how this happened in the graph:
Gold, Silver and Platinum Quotes from TradingView
Fundamental analysis of the palladium market
Today, palladium plays a small but important role in the global economy. In 2022, demand recovered after the coronavirus crisis, but did not reach the level of 2022:
Source /
Unlike all other precious metals, palladium is almost not affected by demand from investors - it is a completely industrial metal. In 2022, 85% of palladium will be used in autocatalysts - devices for filtering car exhaust gases. In the 1970s, countries began tightening vehicle emissions standards, most notably nitrogen oxide, one of the main components of smog in big cities. Palladium, unlike platinum, neutralizes N₂O well; it has become more often used in new cars. Due to the shortage of subconductors and problems in the global economy, the demand for palladium in the automotive industry has fallen and has not yet recovered to previous levels.
The remaining 15% of demand comes from the chemical industry, electronics, medicine and jewelry: both in pure form and in alloys such as white gold. If we exclude the auto industry, then the consumption of palladium is falling - the metal has become too expensive, manufacturers are looking for alternatives wherever possible, for example, platinum, which today is almost 2 times cheaper.
Palladium is mined in large quantities in 5 countries: Russia, USA, Canada, South Africa and Zimbabwe. Russia ranks first in the world in production with a market share of 40%. The following places are occupied by companies from South Africa - Anglo Platinum, Impala Platinum, Sibanye-Stillwater. Russia and South Africa are the main suppliers of palladium, see chart:
Source /
Despite constantly growing demand, neither country has been able to significantly increase production. The fact is that palladium is a by-product of the extraction of other metals. Companies from South Africa primarily specialize in platinum (80% of world production), and it has become much cheaper in recent years. Norilsk Nickel also has plenty of problems, although management has plans to increase palladium production.
The situation is partially saved by recycling; the dynamics over 8 years have been positive - an increase of 35%. In general, there has been a shortage of palladium on the market for many years, as can be seen from this graph:
Source /
The excess of demand over supply of palladium on the market has been observed since 2012. In 2022, the metal shortage increased again, which led to a double increase in prices.
In the future, palladium will not lose its position. LMC Automotive predicts that gasoline-powered vehicles (where palladium is most used) will cease to be sold until 2035. The market will be captured by hybrids that still use fuel. For details, follow the link to the study on this topic.
What will the price of palladium be next year? Let's try to predict.
What is an impersonal metal account and what metals can be purchased
An impersonal metal account (abbreviated as OMS) is a financial instrument that allows citizens today to open a fixed-term (deposit) or perpetual (demand) deposit. It differs from a ruble or foreign currency deposit in that it is settled in grams of precious metal, and not in monetary units.
The investor thus becomes the owner of silver or palladium, but only virtual. When carrying out operations under compulsory medical insurance, the individual physical qualities of the metal are not taken into account: the number of ingots, sample, manufacturer, serial numbers. However, it will not be possible to withdraw funds from compulsory medical insurance in the form of real metal.
When opening compulsory medical insurance, the investor is traditionally offered 4 metals to choose from:
- Gold.
- Silver.
- Platinum.
- Palladium.
Dynamics
The features of the precious metals market and price changes on it are clearly shown by comparing the dynamics of two key parameters - the price of a troy ounce of gold (the traditional measure of weight for this metal, equal to 31.1035 grams) and the domestic MICEX stock exchange index. To obtain a more objective picture, it is advisable to consider a fairly long period - from 1998 to the current year. The first indicator is indicated in US dollars, the second - in traditional points.
Analysis of the diagram clearly demonstrates several important points:
- with a stable financial and economic situation in the country, the dynamics of the price of gold is practically not inferior to the growth of the stock exchange index;
- when any crisis occurs - 2 of them (in 1998 and 2008) are shown in the diagram, the third (in 2014) is not marked, but is also clearly visible - the rise in gold prices rapidly overtakes the index, which collapses no less quickly;
- The huge difference in dynamics during crises allows gold to easily compensate for a slight lag during times of economic growth.
Based on the analysis, several obvious conclusions can be drawn:
- gold (like other precious metals, the dynamics of which are generally similar) is a much more reliable asset than stock market shares;
- when forecasting crisis phenomena, it is advisable to transfer assets into precious metals;
- With a steadily growing Russian economy, it is reasonable to retain part of the assets in gold and other metals, which will provide a so-called safety cushion and safety of funds in any development of events. Moreover, not everyone is able to predict crises;
- Regardless of the situation on the financial markets and in the economy, investing in gold is the most guaranteed asset, reliably preserving the owner’s funds and often allowing him to earn money.
The general conclusion with which most experts agree is the following. Gold and other precious metals in the form of compulsory medical insurance from Sberbank do not always allow you to earn a lot, but they guarantee a fairly stable income. At the same time, they will definitely eliminate the loss of the owner’s savings.
How the price is formed
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The cost at which metal is purchased today for compulsory medical insurance is not taken out of thin air and depends not only on the Sberbank exchange rate. The initial (first) price is set by the London Precious Metals Exchange (LME) based on the results of trading by the main participants in the world market (today there are 13 companies). Every day at 14:00 Moscow time on weekdays, the Central Bank of Russia publishes precious metals rates on the official website cbr.ru. Quotes of the Central Bank of the Russian Federation are formed on the basis of quotes from the London Stock Exchange.
The metal exchange rate according to the Central Bank of the Russian Federation also depends on the second factor - the ruble exchange rate to the US dollar today. The fact is that the exchange sets the price in US dollars per ounce, and the Central Bank - in rubles per gram. An ounce is always equal in mass to ~31.1 g, which cannot be said about the ruble, because its exchange rate is constantly changing and has been especially unstable in recent years. Therefore, even with the same price of gold on the LME, the rate of the Central Bank of the Russian Federation today may differ quite significantly from yesterday.
The quote on cbr.ru is the second price. There is also a third one - the one that the end consumer, a private investor (for example, me or you) focuses on. The bank, as a commercial organization, works to make a profit, so it slightly changes the price assigned by the Central Bank. Gold and silver are bought from the population at a price below the exchange rate, and sold at an inflated price. The difference - the spread - is the bank's profit.
The law does not regulate the procedure for determining the spread for compulsory medical insurance, so in theory, Sberbank can set any prices. Fortunately for you and me, there is interbank competition, and an organization that sets a draconian sale price will simply be left without investors.
Sberbank adheres to the “golden mean” principle in relation to the spread - this is one of the reasons why depositors choose it to open compulsory medical insurance. The second reason is the reputation of Sberbank. In the minds of the majority of the population, he is reliable enough to trust him with funds.
Should you buy palladium today?
In order to find a high-quality entry point into the palladium market, the first step is to do a technical analysis of the charts. You can do this yourself or rely on a widget:
Based on information from 25 indicators, one of five forecasts is obtained - from “active sell” to “active buy”. I wouldn’t say that they are perfectly accurate, but they do a good job of showing what’s happening in the palladium market today. Depending on the expected duration of the trade, it is worth selecting the appropriate timeframe:
- up to 24 hours - 1 minute, 5 minutes, 15 minutes;
- 1-7 days - 30 minutes, 1 hour, 2 hours;
- 1-4 weeks - 4 hours;
- 1-6 months - 1 day;
- more than 6 months - 1 week.
Palladium is not very good for long-term trades due to high volatility, so the most suitable time frame, in my opinion, is 1 day.
Another indicator that will tell you whether palladium is expensive or cheap today is the ratio of the price to the dynamics of the American S&P500 index:
When the ratio is at its maximum, it means that palladium is quite expensive today and it is worth looking for opportunities to sell or take profits. Well, if the ratio is minimal, then there is a high probability that palladium is undervalued and it is worth considering purchasing options.
Technical analysis without understanding the global picture of the palladium market does not work very well - it is also necessary to study the factors of supply and demand.
Forecast
Today, most experts believe that precious metals will continue to rise in price, but there will not be a sharp increase in the exchange rate. They present both arguments related to all metals (mainly geopolitical) and individual ones (increasing inflation of paper money, finite reserves of precious metals).
For example, there is a version that by the end of 2022, platinum will practically displace palladium from the production of autocatalysts. This will lead to an increase in its demand, and consequently to a strengthening of its position.
Advantages and disadvantages of compulsory medical insurance
Compulsory medical insurance, like any financial instrument, has its pros and cons. The advantages of a metal account include:
- High liquidity with relatively low risks.
- No costs for transportation and storage of ingots.
- No need to pay VAT.
- Relatively small spread.
- Absence (most often) of bank commissions.
- Low entry threshold (from 1 gram for current compulsory medical insurance).
Flaws:
- There is a problem with interbank transactions under compulsory medical insurance (if you opened an account with Sberbank today, you will not be able to transfer metal to VTB).
- Inability to transfer grams from one compulsory medical insurance to another.
- You will have to file a tax return yourself.
- Lack of insurance.
The last minus is the most significant. He is one of the reasons why most investors in compulsory medical insurance today choose Sberbank: in conditions when you can lose everything, reliability becomes more important than profit.
Purchasing and storing bullion at Sberbank
To purchase palladium bullion, you will need to visit a branch of Sberbank of Russia. The metal can be left in the bank for safekeeping by renting a special safe. Unfortunately, Sberbank of Russia does not offer current or savings accounts for physical palladium.
Advantages and disadvantages
One of the advantages is owning real palladium. This is where the advantages end. Among the negative aspects: the need to pay VAT, storage fees, the lack of repurchase of palladium by Sberbank of Russia today, as well as the investment risk, which is higher compared to investments in gold or silver.
Procedure for selling bullion
I did not find information about any bank accepting palladium bars from the population. This indicates low demand for physical metal from individuals. Perhaps the situation will change in the future, but today only pawn shops and purchases willingly accept palladium.
How to make money on compulsory medical insurance
If you have chosen a speculative strategy, then you will have one tactic that has not changed since the first money appeared. Buy cheaper, sell more expensive - that's the whole secret. The only difficulty is predicting the course - even experts tend to make mistakes.
There is complexity. If you often withdraw money and buy metal again, the profit can be offset by the bank spread.
What does profitability depend on?
First of all, it depends on the type of compulsory medical insurance. He can be:
- Deposit (urgent).
- On demand (current).
In the first case, it will not be possible to withdraw money from compulsory health insurance before the deposit expires, and the income will consist of interest accrued on the account. It is advisable to establish deposit compulsory medical insurance for a long period - 3 years or more.
Today, it is impossible to open an urgent compulsory medical insurance at Sberbank, but for general education it is worth knowing about this, because the bank may revise its conditions - not today, then tomorrow.
The current compulsory medical insurance can be replenished unlimitedly, as well as withdrawal of funds. It does not accrue interest, and the trader’s benefit depends on exchange rate fluctuations and the ability to manage the deposit.
Profitability depends on the chosen metal. For example, if you bought gold, platinum or silver in September 2022, you still would not have received a percentage of the profit. But a bet on palladium would bring almost 3,000 rubles from 10,000.
Taxes on income under compulsory medical insurance
An investor who has opened a fixed-term compulsory medical insurance should not worry. The bank itself acts as its tax agent, which at the end of the year transfers the due percentage of the depositor’s income to the Federal Tax Service.
With the current compulsory medical insurance, and Sberbank today offers only this option, it is more difficult. Since the income from it is unpredictable (it may not exist at all), the trader will have to file a declaration independently. The scheme for calculating profits received from changes in exchange rates is simple: the obligation to pay tax arises only when the deposit is closed.
The fact that you filed a declaration yourself will not allow you to be recognized as evading personal income tax.
Account opening methods
An individual needs very little - just a passport, a certificate of TIN assignment (if any) and the required amount.
Poste restante
Those who decide to open compulsory medical insurance at Sberbank have two options:
- Come in person to one of the Sberbank offices (not just any branch is suitable - you should first check by calling 8-800-555-55-50 whether the nearest one is suitable for your home).
- Use the Sberbank Online service (only for personal account users).
In the second case, since the agreement with Sberbank has already been signed and your data is in the database, you can create compulsory medical insurance with a few clicks of the mouse.
Urgent compulsory medical insurance
Today, Sberbank does not offer to charge interest to investors for deposits in metal, so it will not be possible to open a deposit compulsory medical insurance. In those banks where such a service is available, the conditions for its provision are usually the same: either a visit to the office, or a simplified remote scheme for bank clients.
Types of investments in palladium
There are several ways to invest money in palladium. Each of them has its own advantages. You can choose the most convenient and attractive option.
Compulsory medical insurance
Compulsory medical insurance is a current account, the currency of which is metal. The advantage of this method is the absence of VAT, minimal bank commissions, and maximum liquidity. The cost of entry is also insignificant, because the minimum step is 0.1 g of metal. Of the minuses: when selling an asset, the income from the difference in exchange rates received in this case is subject to taxation.
Ingots
Physical palladium can also be purchased, but this option has its drawbacks: Sberbank of Russia today does not buy it from the population, and when purchasing an ingot, you will pay VAT. The purchase will need to be stored somewhere; a safe place will require additional costs.
Investment coins
To date, I have not found any mention of palladium investment coins anywhere. But anniversary copies are widely represented in Sberbank of Russia.
Expert opinion
Lyudmila Pestereva
Our most experienced gold investor
Ask a Question
When purchasing metal in coins, value added tax is not charged, which adds to the attractiveness of this method of investment.
However, the price of investment and commemorative banknotes includes minting costs, so a gram of palladium in a coin will be more expensive than in a measured bar.
Which investment method is more profitable?
Considering all of the above, I advise you to opt for compulsory medical insurance at Sberbank of Russia as the most reliable, most liquid, simple and least expensive way of investing today.
How to open compulsory medical insurance in the SB of the Russian Federation
If you have connected to the Sberbank Online service, you can open compulsory medical insurance today. The procedure will be as follows:
- Scroll down to the bottom of the main page and click “Go to the bank’s offer catalog.”
- Find the item “Metal accounts” in the list.
- Choose the metal that will become your currency (the most crucial moment!).
- Indicate the mass of the metal (the minimum in Sberbank is 0.1 grams of precious metal).
- Confirm the money transfer by clicking the “Continue” button.
- Read the contract carefully (it is short).
- Click on the “Open Compulsory Medical Insurance” button.
Congratulations: from now on you are the owner of several grams (or fractions of a gram) of precious metal.
Current exchange rate at Sberbank of Russia
If we take into account the cost of palladium per 1 gram, then this information is updated, along with the data in Sberbank. In addition, it is important in which region the bank is located. This condition affects the cost of palladium.
Sberbank is an important figure in the market for sales of this metal. The purchase price is 2-3% less than the rate set by the Central Bank, and is sold at the same percentage higher. In the case where there are jumps in palladium prices, the spread can reach 20%.
Price for 1 gram of metal as of October 30, 2022:
- purchase – 2277.00;
- sale – 2483.00.
