Lithium ETF Could Power Up with Growth of Batteries

Given the relatively new industry and the heavy capital expenditures required to gradual build up production, Wilmot warned that investors may require a very long-term view. Investors, though, can still capitalize on growth opportunities further up the supply chain such as Sumitomo Metal Mining and Umicore.

The Global X Lithium & Battery Tech ETF (LIT) tries to reflect the performance of the Solactive Global Lithium Index, which is comprised of a number of global lithium producing companies and lithium battery producers. Top components include Albemarle 19.1%, FMC 16.5%, Quimica Y Minera 6.7%, LG Chem 5.4%, Samsung SDI 5.3%, Panasonic 4.9%, Enersys 4.6%, GS Yuasa 4.6%, BYD Co 4.3% and Tesla Motors 4.1%. Country weights include US 37.2%, Chile 18.2%, South Korea 13.3%, Australia 8.1%, Japan 7.9%, Taiwan 4.7%, China 4.3, Canada 3.2%, Hong Kong 2.9% and France 0.3%.

Given its diverse country exposure and access across the supply chain of lithium and lithium-related products, LIT could provide diversified exposure to the growing industry and limit potential concerns of a slow build up in the battery business.

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