Investing in precious metals can be a great option for diversifying one’s portfolio and protecting one’s wealth. This includes gold, silver, platinum, and palladium. This is because they hold high economic value. However, one cannot deny the risks associated with them. This means there are a few factors that can come into play before one starts investing. Hence, here are some important things one should know before investing in precious metals. Types of precious metals Before diving into precious metal investments, one must understand the types of metals available. The most commonly traded precious metals are gold and silver, but platinum and palladium also play crucial roles in the market. Each metal has unique characteristics and applications. Gold, for example, is often seen as a hedge against inflation and economic uncertainty, while silver has industrial uses in addition to being a store of value. Platinum and palladium are commonly used in the automotive industry for catalytic converters. Diversification is key Precious metals can be a fantastic inclusion in one’s investment portfolio. However, they should not be one’s sole focus. Diversification is key to managing risk. While precious metals can provide stability during economic downturns, their prices can also be volatile in the short term.