3 Copper ETFs

A look at three copper ETFs and what they track.

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There’s more than one way to invest in copper. In addition to buying shares of copper mining companies, investors can gain exposure to the red metal through copper ETFs.

For the uninitiated, exchange-traded funds (ETFs) are securities that track copper like an index fund, but trade like stocks on an exchange. In terms of the red metal, these types of funds can track specific groups of copper mining companies, and can also track copper futures contracts or even physical copper.

There are also copper-focused ETNs, or exchange-traded notes. ETNs are a type of debt security aimed at combining aspects of bonds with ETFs, according to Investopedia. Examples of these include the iPath Pure Beta Copper ETN (ARCA:CUPM) and the iPath Bloomberg Copper Subindex Total Return ETN (ARCA:JJC).

Copper has come back to life in the last two months as investors saw positive economic signals from China, as well as the promise of an increased infrastructure spend under the Donald Trump administration.

According to ETF Trends, copper-related exchange traded products are at their highest level since July 2015.

Here’s a brief look at a few copper ETFs and what they track.

1. United States Copper Index Fund (NYSEARCA:CPER)

The United States Copper Index Fund aims to give investors exposure to a portfolio of copper futures without using a commodity futures account. It tracks the performance of the SummerHaven Copper Index Total Return (INDEXNYSEGIS:SCITR), which is calculated based on certain copper futures contracts selected on a monthly basis.

Year-to-date, the fund is up 20 percent, at $17.08.

2. Global X Copper Miners ETF (NYSEARCA:COPX)

The Global X Copper Miners ETF is up year-to-date 95 percent, and is now trading at $23.04.

The fund tracks the Solactive Global Copper Miners Total Return Index, which covers copper exploration companies, developers and producers. Some of the top holdings in the fund include Hudbay Minerals (NYSE:HBM), Kaz Minerals (LON:KAZ), Capstone Mining (TSX:CS), and Freeport-McMoRan (NYSE:FCX).

3. First Trust Indxx Global Natural Resources Income ETF (NASDAQ:FTRI)

Previously called the First Trust ISE fund, the First Trust Indxx Global Natural Resources Income tracks the ISE Global Copper Index, which tracks miners based on their revenue from copper sales. Companies included in the index must have a market cap of at least $75 million, and are reviewed quarterly for eligibility.

The top 10 holdings for the First Trust ISE fund are similar to those seen on the Global X Copper Miners, with companies held including Jiangxi Copper (SHA:600362), Southern Copper (NYSE:SCCO), Rio Tinto (NYSE:RIO,ASX:RIO,LSE:RIO) and Freeport-McMoRan (NYSE:FCX).

Year-to-date, the First Trust Indxx Global Natural Resources Income ETF is up 18 percent and is now trading at $11.50.


This is an updated version of an article originally published on Copper Investing News on November 25, 2015. 

Securities Disclosure: I, Teresa Matich, hold no direct investment interest in any company mentioned in this article.

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