Electricity demand is ramping up considerably, as data centers proliferate to keep up with AI processing power demands. Of course, data centers are not the only driver of the ravenous demand for electricity, but taken together, that electricity demand can create some powerful investment opportunities. Nuclear stocks in a nuclear ETF like NUKZ could benefit from that demand as old reactors come back online.
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Just this past week, Florida-based firm NextEra Energy won approval to restore a reactor near Cedar Rapids, Iowa. Three Mile Island, once synonymous with fears around nuclear energy, may also see the return of nuclear power plant activity. The Trump Administration’s “One Big Beautiful Bill” Act retained nuclear subsidies while cutting other renewable supports, adding to the case for nuclear power.
A nuclear ETF like the Range Nuclear Renaissance Index ETF (NUKZ), then, could provide an intriguing investment opportunity outside of more traditional equities. NUKZ charges an 85 basis point fee for its services. The strategy tracks the Range Nuclear Renaissance Index, a market cap-weighted index of nuclear stocks from the U.S. and abroad. The U.S. isn’t alone in looking to nuclear power to replace fossil fuels, with the Eurozone also looking more at the category.
NUKZ categorizes its investment opportunities into pure play, pre-revenue, and diversified organizations. The strategy can also include MLPs up to 25%, for example, which could add some additional consistency to the strategy.
The nuclear ETF is already delivering on its approach in terms of performance. NUKZ has returned 45.3% YTD, according to ETF Database. It has outperformed both its ETF Database Category and FactSet Segment averages in that time. Specifically, those averages came in at 24.74% and 33.3% for that time frame.
Looking ahead, the strategy’s exposure to energy and some strong policy supports could make it a nice diversifier. At the same time, it could benefit from that rampant AI electricity demand. For those looking for a potentially strong upside option, NUKZ can appeal.
VettaFi.com is owned by VettaFi LLC (“VettaFi”). VettaFi is the index provider for NUKZ, for which it receives an index licensing fee. However, NUKZ is not issued, sponsored, endorsed, or sold by VettaFi. VettaFi has no obligation or liability in connection with the issuance, administration, marketing, or trading of NUKZ.
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