These precious metals ETCs lost 40% in 2023

The year 2023 has tested the resilience and strategy of investors in these ETCs.
With a significant loss in value, these products offered an important lesson in the volatile nature of precious metals investing and the need for a thorough understanding of the market.
Their performance reflected not only the dynamics on the topic but also the impact of external factors such as geopolitical tensions, global monetary policies and changes in industrial demand.
From analyzing their investment structures and strategies to examining their performance in a challenging market environment, in this article we will offer a comprehensive overview that will help investors better understand these products and evaluate their potential opportunities and risks.
1.
WisdomTree Physical Palladium ETC WisdomTree Physical Palladium, with assets under management of 80 million euros, represents one of the most significant options for investors interested in the palladium market.
This ETC stands out for its physical structure, offering direct hedging through the physical holding of the precious metal.
This approach is particularly attractive to investors seeking real exposure to palladium, rather than mere financial exposure.
Launched on April 24, 2007, the WisdomTree Physical Palladium has a total expense ratio (TER) of 0.49% per year, rather moderate and in line with the category of products that invest in the theme.
read also This stock ETF has gained over 65% in 1 year Despite its size and solid structure, 2023 has been a difficult year for WisdomTree Physical Palladium.
It recorded an annual volatility of 37.55%, an indicator of significant market uncertainty and fluctuations.
This volatility has been driven by a number of factors, including geopolitical tensions, changes in industrial demand and precious metals market dynamics.
The maximum drawdown of 69.70% since launch highlights the risky nature of this investment.
Investors interested in WisdomTree Physical Palladium should consider these factors carefully.
While the ETC offers direct, physical exposure to palladium, its high volatility and significant decline in value requires a well-calibrated risk tolerance.
Additionally, the lack of currency hedging increases exposure to currency risk, a critical factor to consider for non-US-based investors.
read also A green ETF to avoid: -45% in 2023 2.Invesco Physical Palladium ETC The Invesco Physical Palladium, although smaller in terms of assets under management (22 million euros), offers an interesting alternative in the linked ETC market to palladium.
With a total expense ratio (TER) of 0.19% per annum, it is positioned as the cheapest option for investors seeking exposure to palladium.
Launched on April 13, 2011, with tax domicile in Ireland, Invesco Physical Palladium shares many of the features of its larger competitor, including physical replication of the precious metal.
This approach provides investors with additional security in terms of hedging against risks associated with financial positions alone.
Despite its lower TER, Invesco Physical Palladium faced similar challenges to WisdomTree Physical Palladium in 2023.
With an annual volatility of 37.04%, this ETC has demonstrated slightly better stability, but still subject to significant market fluctuations .
The maximum decline of 69.58% since launch further highlights the inherent risks in this type of investment.
Investors considering Invesco Physical Palladium should be aware of its risk and reward profile.
While it offers a lower operating cost, its smaller size may mean less liquidity than the WisdomTree Physical Palladium.
This is crucial for investors who may need to enter or exit their positions quickly.
also read 3 Real Estate ETFs to Watch in 2024 Conclusion In conclusion, both WisdomTree Physical Palladium and Invesco Physical Palladium offer opportunities for investors in the palladium market.
However, 2023 has demonstrated that such investments carry significant risks, including high volatility and exposure to currency risk.
Investors should carefully consider these factors, along with their investment objectives and risk tolerance, before committing to these ETCs.
Disclaimer The information and considerations contained in this article should not be used as the sole and principal basis on which to make investment decisions.
The reader retains full freedom in his own investment choices and full responsibility in making them, since he alone knows his risk appetite and his time horizon.
The information contained in the article is provided for informational purposes only and its disclosure does not constitute and should not be considered an offer or solicitation for public savings.