White House Adds Ownership Stake to Critical Minerals Companies

With the proliferation of technological advancements like AI, the need for base metals is necessary to create the infrastructure hardware like aluminum and steel. Additionally, the heavy demand for electricity to power these applications will require metals like copper and silver. These have strong electrical conductivity properties.

The World Economic Forum noted material use has increased exponentially over the past 50 years, which includes metals. The unprecedented demand could potentially lead to disrupted supply chains in the future. That makes the White House investment stakes more crucial.

“Global natural resource consumption [may] increase by 60% by 2060, compared with 2020 levels,” the World Economic Forum noted. It cited a 2024 United Nations Environment Programme’s Global Resources Outlook report.

Investors can also position themselves to capture potential upside in companies poised to benefit from critical minerals demand. Investors could conduct their own research and building a portfolio of individual stocks. But an easier path to exposure would be via an ETF like the Sprott Critical Materials ETF (SETM A-).

The fund tracks the Nasdaq Sprott Critical Materials Index. It includes global constituents strategically positioned to capture growth in companies operating within the critical minerals space. Constituents within the index include mining companies necessary for the production of uranium, lithium, copper, nickel, silver, manganese, cobalt, graphite, and other rare earth elements.

Investors can also target their exposure to specific metals that can capture the aforementioned growth. For example, the Sprott Physical Silver Trust (PSLV A+) can be used for silver’s electrical conductivity properties. The Sprott Lithium Miners ETF (LITP A) can be used for lithium’s usage in applications requiring lithium-ion batteries, like EVs.

Investors can also opt for an actively managed ETF with broad metals exposure. More specifically, consider the Sprott Active Metals & Miners ETF (METL ).

“METL is the only ETF that provides active exposure to miners of a diverse group of metals,” said Schoffstall, director of ETF product management at Sprott Asset management. “Not only do those metals include critical materials, but it also has exposure to things like steel, platinum, palladium, and has a broader mandate to invest in more diversified metals.”

For more news, information, and analysis, visit the Gold/Silver/Critical Minerals Content Hub.

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