The commodity groups
Metals: precious and industrial
4 min
Metals divide into precious (stores of value) and industrial/base (consumed by manufacturing). They behave very differently.
Precious metals
- Gold — the classic safe-haven and inflation hedge. Gold tends to rise in times of fear, when real interest rates fall, and when the dollar weakens. It pays no income, so it competes with bonds: high real yields make holding gold less attractive. B3 lists a gold contract in reais.
- Silver — part precious metal, part industrial (electronics, solar panels). It is more volatile than gold and tracks both investor sentiment and industrial demand.
Industrial (base) metals
- Copper — the bellwether of global growth, nicknamed Dr. Copper because its price reads the health of construction and manufacturing. Demand is rising with electrification and EVs.
- Aluminium — lightweight, energy-intensive to produce; used in packaging, transport and construction.
- Iron ore — not exchange-traded the way the others are, but economically central to Brazil: Vale (VALE3) is one of the world's largest iron-ore miners and its share price tracks Chinese steel demand closely.
How they trade differently
- Precious metals respond to macro fear, real rates and the dollar.
- Industrial metals respond to the business cycle and Chinese demand above all.
Mixing the two up — treating copper like gold — leads to bad calls. A recession scare can lift gold while crushing copper at the same moment.
Finished reading?
Risk disclaimer
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