SINGAPORE: Even after a record 57 percent rally last year, platinum is cheap relative to gold, signaling more gains as demand grows from carmakers and exchange-traded funds.

An ounce of platinum buys 1.42 ounces of gold, down 42 percent from the record 2.43 ounces in 2001 and 23 percent less than the 10-year average, data compiled by Bloomberg show. Automakers, the biggest buyers, will expand output 20 percent this year, said Evan Smith, who helps manage $2 billion at US Global Investors. Hedge funds raised their bets 163 percent in 2009, about twice gold's increase. ETF Securities Ltd funds lifted holdings to a record 594,465 ounces.

"We are long platinum and short gold," said Jonathan Barratt, the Sydney-based managing director with Commodity Broking Services Pty, who predicted platinum's rally in September. "Gold remains under pressure. As inflation moves lower and the dollar goes higher, gold isn't as solid."