Historically platinum is way more expensive than gold because it's rarer and harder to collect. There were a few times where the price of platinum became cheaper than gold. If you recall everybody was buying gold when people feared paper currency will be worthless or simply buying because the price of gold was going up. This inverted price relationship brought many opportunities in the world of spread trading.
Right now platinum is about -$120 cheaper than gold. Even to be equal, that's $12,000 per contract. However I've seen -$200 at one point (which is about $8000 drawdown from -$120) and of course it could get worse too.
To me, this is a good level to take advantage of. Note that gold is being traded in 100 troy oz where platinum is in 50 oz, so the ratio should be 2:1 (platinum : gold).
Consequently, I executed the following trade today:
Bought 2 PLV5 at 1064.5
Sold 1 GCV5 at 1185.4
The spread of -120.9 (less commissions)
This kind of trade can take a long time to work out, so you need to be able to hold on, but it WILL work out, which is why I traded the contracts with 90 days out rather than active contracts.
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