Uranium Leveraged ETF Performance and Investment

The Global X Uranium ETF has returned around 30% in the past year, significantly outperforming the S&P 500.

This ETF has a 2x leveraged exposure to the Solactive Global Uranium Index, making it a high-risk, high-reward investment option.

The ETF's performance is heavily influenced by the price of uranium, which has seen significant fluctuations in recent years.

Investors should carefully consider the risks and potential rewards before investing in a uranium ETF.

For more insights, see: Global X Data Center Reits & Digital Infrastructure Etf

The Sprott Uranium Miners ETF has had a tough year, with a -13.40% return in the past 12 months. As of 12/31/2024, the average annual total return is 6.12%.

The fund's performance is closely tied to the North Shore Global Uranium Mining Index, which has a similar return of -13.10% over the past 12 months. Interestingly, the MSCI All Country World Index has had a much stronger year, with a 17.49% return in the past 12 months.

Here's a breakdown of the top holdings in the Sprott Uranium Miners ETF:

The top holding, Cameco Corp., makes up nearly 18% of the fund's total market value. The remaining holdings are a diverse mix of uranium mining companies, with a focus on those with strong market presence and growth potential.

Month-End Performance was quite a challenge for investors in December 2024, with the Sprott Uranium Miners ETF (Net Asset Value) experiencing a -13.30% return.

The Sprott Uranium Miners ETF (Net Asset Value) had a 1-year return of -13.40%, which is a significant drop.

The North Shore Global Uranium Mining Index (Benchmark) actually performed slightly better than the Sprott Uranium Miners ETF (Net Asset Value) with a 1-year return of -13.10%.

The MSCI All Country World Index, a global benchmark, had a 1-year return of 17.49%, a stark contrast to the uranium-focused funds.

Here's a snapshot of the funds' performance as of 11/30/2024:

The Sprott Uranium Miners ETF (Net Asset Value) and Market Price both had the same 3-year return of 6.12% and 6.19% respectively.

Let's take a closer look at the top holdings of this investment portfolio. The largest holding is Cameco Corp., with a market value of $272,318,139.52.

The top holding is Cameco Corp., with a market value of $272,318,139.52. This is a significant portion of the overall portfolio, making up 17.46% of the total holdings.

Another notable holding is NAC Kazatomprom JSC, with a market value of $215,316,497.55. This makes up 13.81% of the total holdings.

The top holdings are dominated by uranium-related companies, such as Sprott Physical Uranium Trust and Denison Mines Corp.

Here is a list of the top 5 holdings:

These holdings make up a significant portion of the overall portfolio, and it will be interesting to see how they perform in the future.

The 2x Daily Target Defiance ETF is a unique investment option that seeks daily leveraged investment results of two times the daily percentage change in the Global X Uranium ETF.

This ETF is very different from most other exchange-traded funds and is riskier than alternatives that don't use leverage.

It may not achieve investment results that correspond to two times the daily performance of the underlying security, and may return substantially less during such periods.

The Fund's actual leverage levels may differ substantially from its intended target, both intraday and at the close of trading, potentially resulting in significantly lower returns.

Intriguing read: What Are Financial Leverage Ratios

The North Shore Sprott Uranium Miners Index is the benchmark for several uranium ETFs, including the Sprott Uranium Miners ETF (URNM). It tracks the performance of companies that devote at least 50% of their assets to the uranium mining industry.

The Sprott Uranium Miners ETF has an index dividend yield of 0.81% as of December 31, 2024. This means that for every dollar invested, you can expect to earn 0.81 cents in dividend income.

The ETF is designed to provide investors with a way to invest in the growth of nuclear power through exposure to uranium miners. This includes companies involved in the mining, exploration, development, and production of uranium.

The Fund may not achieve investment results that correspond to two times (2x) the daily performance of the underlying security, and may return substantially less during such periods. This is because the Fund uses leverage, which can amplify losses as well as gains.

If this caught your attention, see: Copper Mining Etfs

The North Shore Sprott Uranium Miners Index is rebalanced semi-annually. This means that the ETF's holdings are adjusted twice a year to ensure that they remain aligned with the underlying index.

Here are some of the countries where the uranium ETFs are available:

The Daily Target 2X Long Uranium ETF (URA) seeks to track the performance of the Global X Uranium ETF, but with a leveraged 2x multiplier. This means that the ETF aims to return twice the daily performance of the underlying security.

Worth a look: 2x Leveraged Etf

Sprott UCITS offers two uranium-focused ETFs: the Sprott Uranium Miners UCITS ETF – Acc and the Sprott Junior Uranium Miners UCITS ETF – Acc.

The Sprott Uranium Miners UCITS ETF – Acc has a significant asset base, with $2.0 billion under management.

This ETF has a concentrated portfolio with 37 holdings, which is top-heavy, with the top three holdings making up over 40% of the fund.

For more insights, see: Sprott Gold Miners Etf

The Sprott Junior Uranium Miners UCITS ETF – Acc is designed to capture the next stage of the uranium bull market by investing in small- and mid-cap uranium miners.

Nuclear power's role in the net-zero transition is driving demand for uranium, and miners will need to step up to meet this demand.

The Junior Uranium Miners ETF (URNJ) provides exposure to small- and mid-cap uranium miners that offer the potential of outperforming in the near future.

Here's a comparison of the two Sprott UCITS ETFs:

Note that the Sprott Uranium Miners UCITS ETF – Acc has a significant asset base, while the Sprott Junior Uranium Miners UCITS ETF – Acc is focused on small- and mid-cap uranium miners.

The global electricity demand is growing rapidly, presenting a clear need for efficient, clean, and cost-effective energy.

Uranium mining has been lower than reactor demand for decades, leaving a supply gap that's expected to be filled by new uranium mines.

Intriguing read: Uranium Ticker Symbol

Nuclear energy is more reliable, efficient, and clean than many other energy sources, making it a critical component in the clean energy transition.

A new bull market is underway, incentivizing miners to explore and develop new uranium mines, potentially allowing for smaller miners to experience significant growth.

Hundreds of new reactors are being constructed or planned, around the globe, which will likely outstrip uranium supply, putting pressure on new and smaller miners to step up.

The Junior Uranium Miners ETF (URNJ) provides exposure to small- and mid-cap uranium miners that offer the potential of outperforming in the near future.

Uranium demand is expected to increase due to the essential role nuclear power plays in the net-zero transition, driving demand for uranium and requiring miners to step up.

The existing supply may not meet future demands, encouraging non-utility uranium buyers to enter the market, and utilities are expected to accelerate uranium purchases to ensure long-term security of price and supply.

Nuclear energy has the highest capacity factor versus both traditional and alternative energy sources and the least CO2 equivalent emissions versus other energy forms, making it critical to reaching net-zero energy transition goals.

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