Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Horizons ETFs Management (Canada) has launched the Horizons Global Uranium Index ETF. Units of the ETF will began trading Thursday on the Toronto Stock Exchange under the ticker symbol HURA.
HURA is the first ETF in Canada to provide direct exposure to the global uranium sector – a universe of companies with a combined value of approximately C$15 billion. Globally, Canada is ranked as the second-largest uranium producing country and is home to the world’s largest publicly traded uranium company, Cameco.
HURA is the first ETF in Canada to provide direct exposure to the global uranium sector – a universe of companies with a combined value of approximately C$15 billion
“There is a realization at the highest levels that wind and solar energy alone will not be able to ensure global carbon emission targets are met,” said Nick Piquard, Portfolio Manager and Options Strategist at Horizons ETFs. “Today, nuclear is the only viable solution to supply zero-emission base load power, and currently, there is not enough uranium being mined to meet planned growth. These factors combined make for a very positive opportunity for the uranium mining sector.”
HURA seeks to replicate, to the extent possible, the performance of the Solactive Global Uranium Pure-Play Index, net of expenses. The index is designed to provide exposure to the performance of a basket of issuers which are primarily involved in the uranium mining and exploration industry; invest and participate directly in the physical price of uranium and are available on global stock exchanges in developed markets.
The constituent issuers of the index will be initially market capitalization weighted on each rebalancing date, subject to a cap for each constituent issuer of a maximum of 20% of the net asset value of HURA as at each rebalancing date. A maximum aggregate of 25% of HURA’s holdings will be allocated towards companies that focus on tracking the physical price of uranium.
“Global mining ventures can carry significant investment risks. By investing through a diversified ETF like HURA, you can potentially achieve greater stability and risk-mitigation to your Uranium-sector exposure,” said Piquard. “Our global basket approach to the Uranium sector provides access to production happening across the globe – from the world’s largest in Kazakhstan to emerging mining operations in the United States.”
(This article first appeared in the Canadian Mining Journal)
