Now that precious metals have gotten the physically-backed exchange traded fund (ETF) treatment, providers are now setting their sights on base metals.
Both iShares and JP Morgan Chase have filed with the Securities and Exchange Commission (SEC) to launch their own physically-backed copper ETFs. Why do so many want in on this metal now? [Copper ETFs: Why Higher Prices May Stick.]
Dan Caplinger for The Motley Fool on CNBC reports that there are a number of factors supporting bullishness toward copper these days:
- Copper is used in everything from electrical wire and plumbing to electronics, and demand for copper is seen as a general indicator of economic activity. [More Copper Investing Opportunities With ETFs.]
- Copper is a major component of many commodity indexes; in fact, the Goldman Sachs index gives copper more weighting than it does to gold or silver.
- Mining for gold often produces copper as an additional byproduct and vice versa. So investors who are interested in gold often find that their investments are also affected by conditions in the copper market.
Gary Gordon for ETF Expert reports that some blame copper ETFs for the rise and fall of copper prices in recent years. However, there was no physically-backed ETF, so can they really be blamed? Hardly.
While you wait for a physical copper fund, check out some of these other options. For more stories about copper, visit our copper category.
- First Trust ISE Global Copper (NASDAQ: CU)
- Global X Copper Miners ETF (NYSEArca: COPX)
- iPath DJ-UBS Copper (NYSEArca: JJC)
Tisha Guerrero contributed to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.