Of course, these large mining companies are not the last word in the market. In fact, there are quite a few mid-tier and junior uranium exploration companies that investors may want to take a closer look at. As a starting point, check out our list of the top-performing TSXV- and TSX-listed stocks and our list of the biggest ASX-listed uranium stocks. Additionally, assessing the management team’s experience and track record in the uranium sector is crucial. Investors should also consider the company’s relationships with governmental bodies, as regulatory approvals can impact mining operations. Informed evaluations can help investors make more strategic decisions when selecting uranium-related stocks.
VanEck Vectors Uranium+Nuclear Energy ETF (NYSE: NLR)
Investors should stay informed about these factors to navigate this complex yet potentially rewarding sector effectively. ETFs and mutual funds provide diversified exposure to the uranium sector. The Global X Uranium ETF (URA) invests at least 80% of its total assets in the securities of the underlying index and in American Depositary Receipts (“ADRs”) and Global Depositary Receipts. The fund’s portfolio currently also includes Kazatomprom and Cameco, but also SPROTT PHYSICAL URANIUM TRUST, Yellow Cake PLC and smaller uranium companies such as CGN Mining Corp.
- Over the past few years, it has actually been hard to find a commodity in the market that hasn’t hit its ATH or at least come close to its former price highs.
- It is possible to install very efficient small reactors in such machines, which would provide them with energy for many years.
- Also, China declared its interest in this technology and even built the first ever SMR in July 2021.
- The uranium supply chain exhibits complexity and vulnerability to disruptions.
Growing Investments in Emerging Markets
Humanity, not wanting to abandon technological development, will eventually have to undergo an energy transition within the framework of ecology and adopt the most effective and safest energy solutions. Such solutions are provided by nuclear power plants, in which uranium is the main component of nuclear fuel. The nuclear sector currently accounts for 11% of the world’s electricity generation and 60% of clean energy respectively. The price of uranium has strengthened in recent years, leaving investors wondering how to enter the market. Moreover, uranium ETFs typically have lower fees compared to actively managed funds and can be more easily traded on major stock exchanges. They also provide a more straightforward way for investors to enter the uranium market without needing to engage in individual stock analysis or deal with the complexities of physical uranium ownership.
There are also geopolitical risks, as uranium supply chains can be affected by political instability in key producing regions. Investors should also consider the potential for technological advancements or shifts toward alternative energy sources that could impact the long-term demand for uranium. It’s crucial for investors how to invest in uranium to conduct thorough research and consider their risk tolerance before entering the uranium market.
A brief history of uranium mining and uranium bubbles
One of its holdings is the Sprott Physical Uranium Trust, a fund that invests solely in physical uranium. As mentioned, it’s been credited with helping to boost prices and has become a popular investment vehicle. Nuclear power is a significant source of energy in many countries, and as global energy demands continue to rise, the need for sustainable energy solutions increases as well. Download our investing guide to unleash the power of informed investments. The Investing News Network is a growing network of authoritative publications delivering independent, unbiased news and education for investors. We deliver knowledgeable, carefully curated coverage of a variety of markets including gold, battery metals, biotech and many others.
- In 2016, Cameco suspended operations at its Rabbit Lake mine due to low uranium prices.
- Smaller uranium mining companies can offer investors higher growth potential.
- The Cigar Lake mine still contains the world’s largest undeveloped deposit of high-grade uranium ore.
- With a total net asset value of $5.41 billion and a low management expense ratio of 0.64%, it offers an efficient way to gain exposure to physical uranium.
What are the risks associated with investing in uranium?
Both have market caps around $1 billion so are about 1/10th the size of the uranium giant Cameco. So they likely carry greater downside risk if the uranium bull collapses. But, on the other hand, they will likely run higher and faster than Cameco shares if it continues.
Trading uranium stocks is not possible during weekends because the market is closed. When the market is open, prices of stocks companies and ETFs are of course constantly fluctuating during trading hours. There is also the issue of finding a qualified workforce of engineers and specialised physicists, which can be a potential problem when distributing nuclear technology worldwide to less developed countries. Climate neutrality and clean energy dominate the development plans of both the European Union and the USA.
It’s a big producer of uranium, but it comes with political and other risks.Both of these companies made up large shares of the uranium mining ETFs mentioned above.Down the spectrum are small-cap miners. Two examples of these are Uranium Energy Corp (UEC) and Energy Fuels (UUUU). Investing in uranium offers an opportunity to diversify a portfolio with exposure to a resource that plays a critical role in global energy production. Whether through direct investments in uranium, mining stocks, ETFs, or other related vehicles, uranium investments come with both high potential rewards and significant risks. By considering the supply-demand dynamics, geopolitical issues, and environmental regulations, investors can better navigate the complexities of uranium investing and make more informed decisions. Each of these companies both mine uranium, but they are relatively small compared to the giant Cameco.
Uranium is a valuable resource primarily known for its use as fuel in nuclear reactors, but it also holds the potential for significant investment opportunities. As a mineral with industrial, environmental, and geopolitical implications, uranium offers investors unique opportunities. Whether you are looking for a direct exposure to uranium itself or seeking to invest in related companies, understanding the methods and risks of investing in uranium is essential. Uranium, a key component in nuclear power generation, presents a unique investment avenue. Besides physical uranium, you can invest in uranium stocks, exchange-traded funds (ETFs), and even uranium futures.
Diversify Your Portfolio With Uranium Assets and Wine
Over the past few years, it has actually been hard to find a commodity in the market that hasn’t hit its ATH or at least come close to its former price highs. We had a boom in aluminium, copper, building materials, steel and other raw materials. But it turns out that uranium with its current spot price at around $50 is still almost three times cheaper than it was at the peak of the 2007 bull market. Uranium Energy Corp (UEC) is a U.S. mining company with a set of government licences and permits to mine its deposits in the western and central U.S. Potentially, the company – as one of the few U.S. nuclear companies with a clean licence situation – could enjoy strong demand from the U.S. nuclear sector in the future. Once the resources are exhausted and the mining operations are completed, remote areas of the Kazatomprom mine are restored to their pre-mining condition, both above and below ground.
How to invest in uranium futures?
In a May 2024 interview with INN, Ben Finegold shared his thoughts on uranium’s market dynamics, which he remains very bullish on. Believers include John Ciampaglia, CEO of Sprott Asset Management, who sees many extremely bullish factors shaping today’s uranium market. Now that we have established the context around uranium’s importance, let’s look at the various methods to invest in this valuable resource.
We do not provide investment advice or solicitation of any kind to buy or sell any investment products. Trading carries a high level of risk and may not be suitable for all investors. In this article, we explore how to invest in uranium, the available investment vehicles, and what factors to consider when making investment decisions. The market moves of the fund, which began buying uranium backed by physical deliveries at any price and in any quantity while accepting any spot price, in a way “revealed’ the actual price of the raw material. Eight of the ten largest ISR mines in the world are operated by Kazatomprom, giving the company a strategic position in the market. The CFD type of uranium ETFs investment is a financial contract that you trade to earn the price difference between your open and closed positions.