A lithium sector-related exchange traded fund climbed Monday as bullish battery and electric vehicle reports project rising demand and opportunities in the market ahead.

The Global X Lithium & Battery Tech ETF (NYSEArca: LIT) increased by 7.3% on Monday.

According to The Insight Partners’ High Voltage Battery Market Forecast to 2027 report, the high voltage battery market is expected to enjoy high growth over the years ahead, especially as batteries are used in electrical and hybrid vehicles.

Among those leading the charge in the sector on Monday, BYD Company shares surged 19.9% and Tesla (NasdaqGS: TSLA) jumped 9.7%. LIT’s portfolio includes 5.8% in TSLA and 5.6% in BYD Co.

The increased demand for these types of batteries, which will help generate more power compared to ordinary batteries, will be used as an alternative source of power for electric and hybrid vehicles.

Furthermore, due to the increased concerns over environmental issues, global governments are supporting the development of electric vehicles worldwide. Consequently, the high voltage battery market will continue to enjoy increased interest and investments as electric vehicles is expected to drive the growth.

According to A2Z Market Research’s Global Small Electric Vehicles Market Report 2020, the small electric vehicles market is also set to enjoy huge growth through 2026.

“Small Electric Vehicles Market is growing at a High CAGR during the forecast period 2020-2026. The increasing interest of the individuals in this industry is that the major reason for the expansion of this market,” according to A2Z Market Research.

As demand for electric vehicles and the batteries that power them continue to rise from more environmentally friendly consumers, something like the Global X Lithium & Battery Tech ETF may continue to capture the growth opportunity. LIT tracks the Solactive Global Lithium Index, which is designed to measure broad-based equity market performance of global companies involved in the full lithium cycle from mining and refining the metal, through battery production.

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