Despite tariff contagion upending prices at the tail end of July, copper continues to push higher ahead of its industrial metal peers (as seen in index comparison chart below). This performance comes as copper is under consideration as a critical mineral by the US Geological Survey (USGS).
The S&P GSCI Copper Index highlighted increasing prices and performance versus the broader industrial metals index. This is despite heavy volatility earlier in the year, Liberation Day, and most recently, the 50% tariffs on copper imports. Those tariffs were mostly isolated to copper pipes, wires, rods, sheets, and tubes, as well as pipe fittings, cables, connectors, and electrical components.
Nonetheless, with global electrification occurring at a rapid pace, copper is an essential industrial metal due to its conductivity properties. As mentioned, the USGS announced that copper would be under consideration as a critical mineral given potential severe ramifications if a supply disruption in the copper industry occurred.
Additionally, note the outperformance of physical copper and copper stocks versus other asset classes. A chart in a Sprott Copper Report penned by ETF product manager Jacob White highlighted this.
2 Ways to Get Copper Exposure
Getting copper exposure can provide investors an option to diversify their portfolios with commodities. This diversifier allows for exposure that’s typically uncorrelated to the broader market. Copper, specifically, can also target future growth in the heavier usage of electricity. Physical copper is an option, but another way is to target miners. As demand for copper globally rises, so will the need for mining and exploration activities.
For generalized exposure to copper mining, consider using the Sprott Copper Miners ETF (COPP ). It adds exposure to mostly large- and mid-cap companies domiciled across various countries, which adds to the fund’s diversification benefits.
In addition to copper mining exposure, COPP also includes physical copper in the fund, which can track spot prices of copper more closely. The mining/physical copper combination gives COPP and its in
For those looking to turn up the wick on the growth potential of copper mining companies, small-cap exposure is available with the Sprott Junior Copper Miners ETF (COPJ ). The fund tracks the Nasdaq Sprott Junior Copper Miner Index (NSCOP), which includes mid, small- and micro-cap companies in copper-mining related businesses.
For more news, information, and analysis, visit the Gold/Silver/Critical Minerals Content Hub.
The Nasdaq Sprott Silver Miners Index tracks the performance of companies involved in silver production, exploration, and physical silver holdings. The Nasdaq Sprott Copper Miners Index tracks global companies engaged in copper production, exploration, and physical copper holdings. The Nasdaq Sprott Critical Materials Index tracks companies mining essential materials such as uranium, lithium, copper, and rare earths.
An investor should consider the investment objectives, risks, charges, and expenses carefully before investing. To obtain a Prospectus, which contains this and other information, contact your financial professional or call 888.622.1813. Read the Prospectus carefully before investing, which can also be found by clicking one of the links below.
Past performance is no guarantee of future results. One cannot invest directly in an index.
Diversification does not guarantee profits or protect against losses in declining markets.
Funds that emphasize investments in small/mid-cap companies will generally experience greater price volatility. Diversification does not eliminate the risk of investment losses. ETFs are considered to have continuous liquidity because they allow an individual to trade throughout the day. A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses, affect the Fund’s performance.
Sprott Asset Management USA, Inc. is the Investment Adviser to the ETFs. ALPS Distributors, Inc. is the Distributor for the ETFs and is a registered broker-dealer and FINRA Member. ALPS Distributors, Inc. is not affiliated with Sprott Asset Management USA, Inc. or VettaFi.
Exchange Traded Funds (ETFs): SETM, LITP, URNM, URN, COPP, COPJ, NIKL, SGDM SGDJ
Physical Bullion Funds: PHYS, PSLV, CEF, and SPPP.
The S&P GSCI Copper Index reflects the performance of copper futures over a 12-month period, serving as a benchmark for copper price trends. The S&P GSCI Industrial Metals Index tracks a diversified basket of industrial metals including copper, aluminum, lead, nickel, and zinc. The Nasdaq Sprott Copper Miners Index represents global companies involved in copper production, exploration, and development, as well as physical copper holdings. The S&P 500 Index comprises 500 leading publicly traded U.S. companies and is widely used to gauge the overall health of the U.S. stock market. LMCADY Comdty is the Bloomberg ticker for the official settlement price of Grade A copper on the London Metal Exchange for cash delivery. The Bloomberg Commodity Index (BCOM) tracks futures prices of 23 physical commodities across energy, metals, agriculture, and livestock, offering broad exposure to global commodity markets.
