HZMMF - Sprott launches nickel mining ETF to capture growing EV green energy demand

2023-03-22 08:46:57 ET

Sprott Asset Management revealed the launch Wednesday of a new exchange traded fund focused on nickel mining, meant to take advantage of growing demand for the key component in batteries used in EVs and other green energy endeavors.

The Sprott Nickel Miners ETF ( NIKL ) is designed to offer exposure to a selection of global securities in the nickel industry. The fund will focus on such companies as producers, developers and explorers, with Sprott touting the offering as the first U.S.-listed ETF to target nickel mining specifically.

"Nickel is a vital component in the rechargeable batteries used for hybrid and electric vehicles and clean energy storage," said John Ciampaglia, CEO of Sprott Asset Management.

"Automakers have begun adding more nickel to EV batteries to increase their drivable range. Demand for this critical mineral for use in EVs and battery storage may increase nearly 20 times by 2040, relative to 2020," Ciampaglia added. "We believe nickel producers are well positioned to benefit from the significant investment required to fund the energy transition."

The ETF has a 0.75% expense ratio. Meanwhile, the fund reported that 49.6% of its holdings being based out of Australia. For the rest of its holdings, Canada, Indonesia and the Philippines represent the second, third and fourth largest domicile breakdowns at 19%, 11.3%, and 10.4% respectively.

Looking at specific companies, here are NIKL’s top five positions along with their weightings in the fund:

• Nickel Industries Limited ( OTCPK:NICMF ) 13.40%.
• IGO Limited ( OTCPK:IPGDF ) 12.89%.
• PT Vale Indonesia ( OTCPK:PTNDF ) 11.31%.
• Nickel Asia Corporation ( OTCPK:NCKAF ) 6.61%.
• Horizonte Minerals Plc ( OTCPK:HZMMF ) 6.31%.

In broader financial news, stock index futures remain muted on Wednesday as investors wait for word from the FOMC.

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