With the first month of 2025 in the books, copper prices are higher. The long-term demand could sustain itself, making copper-focused ETFs an alluring option given the growth prospects.
As a portfolio diversification tool, getting copper exposure is an intriguing alternative for the long haul. With the global electrification underway, copper’s electrical conductivity properties make it an important industrial metal for alternative energy technology. That will amplify the demand for copper when looking 10, 20, or 30 years ahead, according to some industry analysts.
Tariff Wars Could Propel Copper Prices
“When looking ahead to 2050, the global economy is probably going to need about 80% to 90% more copper than what is being produced today – which adds up to between 50-million and 60-million tons a year by 2050, says Standards Chartered Bank metals and mining global head Richard Horrocks-Taylor,” reported Mining Weekly.
Another macroeconomic factor that could propel copper prices further is the tariff wars initiated by President Trump in the early stages of his second presidential term. Whether or not that tamps down demand remains to be seen. But for now, it could be a boon for the copper industry as a revenue generator given the forecast of higher prices.
Passing on Higher Costs From Imports to Consumers
“In the U.S., manufacturers will have little choice but to pass on higher costs from imports to consumers until the downstream industry (refining/smelting) has undergone suitable investment,” said Natalie Scott-Gray, senior metals analyst at StoneX.
Whether it’s to play the effects of higher prices in the short term or the long term, Sprott has a pair of ETF options to consider for copper exposure. One offers broad-based copper mining exposure. Another adds a growth component with a focus on small-caps.
2 Copper Exposure Options
The Sprott Copper Miners ETF (COPP ) tracks the Nasdaq Sprott Copper Miners Index (NSCOPP). The index tracks the performance of a selection of global securities in the industry. That includes producers, developers, and explorers that support the industry. For diversification, COPP provides blanket exposure to this mining industry by focusing on large-, mid-, and small-cap mining companies.
Investors harboring a risk-on sentiment who are not averse to the volatility of small-caps can choose the Sprott Junior Copper Miners ETF (COPJ ). The fund aims to track the total return performance of the Nasdaq Sprott Junior Copper Miners Index. The index incorporates mid-, small-, and micro-cap companies entrenched in copper-mining-related businesses, offering exposure to equities with high growth potential.
For more news, information, and analysis, visit the Gold/Silver/Critical Minerals Channel.
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. 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 LP or VettaFi.
Exchange Traded Funds (ETFs): SETM, LITP, URNM, URNJ, COPP, COPJ, NIKL, SGDM and SGDJ
