Diamonds versus precious metals: What gleams most against USD exchange rates?

Rihab Bedoui, Khaled Guesmi, Saoussen Kalai and Thomas Porcher

Finance Research Letters, 2020, vol. 34, issue C

Abstract: Historically, commodity market, particularly the metal market has been used as a hedge for stock market and currencies during time of distress. In this paper, we shed light on a new alternative asset and examine the hedging and safe haven ability of diamonds and five precious metals that is, gold, silver, palladium, platinum and rhodium by using copula process. Then, we compare the performance of diamond versus metals in terms of hedging and safe haven against USD depreciation. Our empirical results show that gold, silver, palladium and platinum outperform diamonds and rhodium in term of hedging against USD movement. Our finding for safe haven study reveals that both precious metals and diamonds serve as a weak safe haven.

Keywords: Copulas; Diamonds; Precious metals; Alternative asset; Safe-haven, Hedge; USD depreciation (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:34:y:2020:i:c:s1544612319305288

DOI: 10.1016/j.frl.2019.08.001

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