Lithium has been called “white” gold and the “new petroleum,” but for the average investor wanting to get in on lithium and other energy transition metals and minerals, options are largely limited to investing directly in individual miners and junior exploration companies.
Sprott Asset Management is making it easier for investors to buy “white gold,” as well as other energy transition metals, with four new energy transition exchange traded funds (ETF). The new ETFs trade on the Nasdaq and have management fees of 0.65% to 0.80%, depending on the particular ETF.
Sprott today launched four new ETFs, one of which – the Sprott Energy Transition ETF (Nasdaq:SETM) – covers three broad buckets:
- energy generation (uranium, silver and rare earths);
- energy transmission (copper); and
- energy storage (lithium, nickel, manganese, cobalt and graphite).
Three other ETFs launched today are Sprott Lithium Miners (Nasdaq:LITP), Sprott Junior Uranium Miners (Nasdaq:URNJ) and Sprott Junior Copper Miners (Nadaq:COPJ).
A number of Vancouver companies, like Lithium Americas (TSX, NYSE:LAC) and American Lithium Corp. (TSX-V:LI), are included in the Lithium Miners ETF.
“We do think the energy transition materials fund, which is the broader based product, probably has the most appeal for most investors,” Steve Schoffstall, Sprott’s director of ETF product management, told BIV News. “It’s a way to get invested in the theme, if you’re not too well versed in the underlying materials that make up the index.”
There is clearly a growing interest in the minerals and metals that will be needed for the energy transition underway, as the world tries to shift away from fossil fuels.
“When you look at 2022, its estimated that about $1.1 trillion was invested in the energy transition,” Schoffstall said. “And that can include things like wind and solar farms, all the way down to EVs and infrastructure to electrify the grid.
“The significance about that number is that, for the first time, the investment in energy transition equaled that of investment in fossil fuels.”
Sprott Asset Management specializes in investing in minerals and metals.
“When we looked at the landscape, we saw that, given our decades of experience in the mining industry, there was something that we could provide that was lacking in the marketplace,” Schoffstall said. “We’re really using our background to select pure-play miners for each one of those critical minerals.
“We start with a universe of about 90,000 stocks, and we get that down on the energy transition materials fund to about 112 global equities that we think really target those critical minerals that we’re looking to provide exposure to.”