Uranium has remained resilient despite market volatility, driven by solid fundamentals and renewed interest from investors. According to the Sprott Uranium Report, uranium’s structural supply-demand story and inelastic demand have allowed it to hold its ground.
In May, several hedge funds covered their short positions, signaling a potential shift towards bullish prices. The recent push to increase America’s nuclear energy capacity could further boost prices. While the World Uranium Index is down 20% overall, it has started to rebound, with uranium prices up 8% over the past month.
The Sprott Uranium Miners ETF (URNM) offers investors a chance to diversify their portfolios with commodities uncorrelated to equities or bonds. Tracking the North Shore Global Uranium Mining Index, URNM includes companies involved in uranium mining, exploration, development, and production. The fund has an added growth component, with 50% of its holdings in small- and micro-cap companies.
Cameco Corp is the largest holding, one of the largest uranium mining/production companies with a market cap over $20 billion. Investors should carefully consider investment objectives, risks, charges, and expenses before investing in URNM.
Please note that past performance is no guarantee of future results, and diversification does not eliminate investment losses. ETFs are considered to have continuous liquidity, but higher portfolio turnover rates may result in higher transaction costs and taxes.
Source: https://www.etftrends.com/gold-silver-investing-channel/uranium-stays-resilient-may-miners-showing-upside