Precious Metal Derivatives - Chile

The nominal value in the Precious Metal Derivatives market is projected to reach US$37.34bn in 2024.
It is expected to show an annual growth rate (CAGR 2024-2029) of 5.27% resulting in a projected total amount of US$48.27bn by 2029.
The average price per contract in the Precious Metal Derivatives market amounts to US$0.12 in 2024.
From a global comparison perspective it is shown that the highest nominal value is reached United States (US$11.92tn in 2024).
In the Precious Metal Derivatives market, the number of contracts is expected to amount to 390.90k by 2029.

Definition:

The Precious Metal Derivatives market refers to derivatives of precious metals such as gold or silver. These include financial vehicles such as options and futures. Derivatives allow investors to profit from a commodity’s value development without owning the physical commodity (e.g. instead of owning a unit of gold, an investor could own a derivative of gold). Therefore, physical commodities are out of scope in this analysis.

Structure:

The market contains the following KPIs: annual notional value, the number of traded contracts, the open interest (number of outstanding contracts at the end of a year), the average notional value per contract as well as the price data of popular specific derivatives of this category.

Additional information:

Examples of popular precious metal derivatives are gold, silver, or platinum.

Precious Metal Derivatives, e.g. Gold, Silver, Platinum

Physical precious metal commodities

The Precious Metal Derivatives market in Chile is experiencing a notable surge in activity and interest from investors.

Customer preferences: Investors in Chile are increasingly turning to Precious Metal Derivatives as a way to diversify their portfolios and hedge against market volatility. The allure of potentially high returns coupled with the ability to trade these derivatives without owning the physical assets is attracting a wide range of investors, from individual traders to institutional players.

Trends in the market: One of the key trends in the Chilean Precious Metal Derivatives market is the growing popularity of gold and silver derivatives. These two metals have traditionally been seen as safe-haven assets, especially during times of economic uncertainty, making them attractive options for investors looking to protect their wealth. Additionally, the rise of online trading platforms has made it easier for investors in Chile to access and trade Precious Metal Derivatives, further fueling market growth.

Local special circumstances: Chile's strong mining industry plays a significant role in shaping the Precious Metal Derivatives market in the country. As one of the world's top producers of copper, Chile's economy is closely tied to the performance of commodities markets. This close relationship with the commodities sector has also influenced investor sentiment towards Precious Metal Derivatives, with many seeing them as a way to capitalize on the country's mining expertise and resources.

Underlying macroeconomic factors: The economic stability and regulatory environment in Chile are also contributing to the development of the Precious Metal Derivatives market. With a well-established financial system and robust investor protections in place, Chile provides a secure and attractive environment for trading these derivatives. Additionally, factors such as inflation rates, interest rates, and currency fluctuations play a role in shaping investor behavior and driving demand for Precious Metal Derivatives in the country.

Data coverage:

Figures are based on commodity derivatives, their notional value, the number of contracts traded, the open interest (outstanding contracts at the end of a year), and the average value of a contract.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use market research & analysis, and data of World Bank, as well as the World Federation of Exchanges. Furthermore, we use relevant key market indicators and data from country-specific associations and national data bureaus such as GDP, wealth per capita, and the online banking penetration rate. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. In this market, we use the HOLT-damped Trend method to forecast future development. The main drivers are GDP per capita an the online banking penetration rate.

Additional Notes:

The market is updated twice per year in case market dynamics change.

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

Precious metals have long been seen as a hedge against inflation and economic uncertainty. When stock markets are volatile or currencies devalue, investors flock to precious metals like gold and silver as a store of value, driving their prices up. Gold, in particular, stands out as the most popular choice for protecting wealth in times of uncertainty, with central banks around the world holding vast reserves to safeguard against currency fluctuations and political upheaval. Also, the demand for gold as an investment outweighs its demand for industrial uses - more so if we also consider owning jewelry as a form of investment. This pattern contrasts sharply to other precious metals. Silver, for instance, has a much stronger industrial demand, due to its use in sectors like electronics, solar panels, and medical equipment. Platinum follows a similar pattern, with industrial demand outpacing investment demand, due to the its many different end uses.