A few decades ago, nuclear energy was a controversial topic. From nuclear plants having accidents to the threat of nuclear wars, everyone had an opinion about this type of energy. But now, the controversy has died down and nuclear energy is harnessed for a lot of applications in today’s modern world. However, that doesn’t mean people don’t have opinions about it, especially investors.
So if you are an investor who wants to either diversify your portfolio, hedge some of your nuclear energy risk, or just gain exposure to the commodity due to your research or your opinion, then you may want to explore nuclear energy ETFs.
You could try and select specific stocks involved with nuclear energy, or you can consider a nuclear energy index, but that involves a lot of transactions and price-chasing to gain exposure to the industry as a whole. However, if you are looking to target the sector, then the easier way is to utilize nuclear ETFs in your investment strategy. With one transaction, you can gain exposure to the industry via a mini-portfolio focusing on nuclear energy equities.
And not only do you get the instant exposure, but you gain many of the other benefits that come with trading ETFs, especially the tax advantages. And in some cases ETFs can help you save money. So if this is all music to your investing ears, then consider some of these nuclear energy funds…
Nuclear Energy ETFs
NLR - Market Vectors Nuclear Energy ETF
This fund tracks the DAXglobal Nuclear Energy Index and both the ETF and the underlying index target the stocks of companies involved in the production and harnessing of nuclear energy across the globe. Some of the top holdings include Electricite de France, Exelon, and Constellation Energy Group.
NUCL - iShares S&P Global Nuclear Energy Index ETF
This fund tracks the S&P Global Nuclear Energy Index and targets companies involved with nuclear energy. Some of the top holdings include Mitsubishi Heavy Industries, JGC Corp, and Amec PLC.
PKN - PowerShares Global Nuclear Energy ETF
This fund from Invesco Powershares tracks the WNA Nuclear Energy Index and targets global companies that utilize nuclear energy, including reactors, utilities, construction, technology, equipment, service providers and fuels. Some of the top holdings include Areva, Toshiba Corp, and Parker Hannifin.
PKN was closed in February 2012
While uranium ETFs are not a direct play on nuclear energy, they do have a strong correlation to the sector since uranium is the base of nuclear energy. There is only one fund available as of today, but I felt it should be included on this list as well.
URA - Global X Uranium ETF
This fund tracks the Solactive Global Uranium Index and both the index and the ETF include companies involved with the exploration, mining, and harnessing of uranium. Some of the top holdings include Cameco Corp, Uranium One, and Hathor Exploration.
Please check back often as I will update this list based on new additions and any delistings. Also, before making any trade, make sure you conduct due diligence and research every fund. Know the ins and outs of each ETF and watch how it reacts to different market conditions. And if you have any questions, consult your broker or a certified financial professional. Every trade has risk, make sure you are well aware of yours.