Industrial metals, also known as base metals, are the gears of the capitalist machine. Industrial metals, such as copper, tin, alluminium and zinc have thousands of different uses in construction, components, consumer goods as well as healthcare. The far-reaching legacy of such commodities is made possible through the plentiful known reserves of these items. Unlike precious metals, which are incredibly rare and expensive to extract, commodities such as copper are big business, but relatively cheap.
But that isn’t to say that investors have been turning their back on such metals during the recent commodity boom. The price copper, zinc and tin have not seen price rises of the same scale of gold and silver, but they have still outperformed stocks over the past decade. It’s disapointing to realise that an inactive lump of refined ore delivers has delivered greater returns than corporations of employees.
Industrial metals ETFs holding an array of metals (or derivatives representing metals), such as zinc, lead, copper, tin, steel, alluminum, colbalt and iron. To help kick start your research into long or short industrial/ base metal ETFs, I have prepared a list of available funds for you to choose from below. I can’t claim the list is guaranteed to be comphrensive, but it should include all the large players on the scene. Small ETFs with low trading volumes and asset values will be less liquid and may charge higher management fees, so you’re probably best off sticking to the larger funds.
Dow Jones-AIG Industrial Metals Total Return ETN – (Ticker JJM
E-TRACS CMCI Industrial Metals ETN – (Ticker UBM)
PowerShares DB Base Metals Double Long ETN – (Ticker BDD)
PowerShares DB Base Metals Double Short ETN – (Ticker BOM)
PowerShares DB Base Metals Fund – (Ticker DBB)
PowerShares DB Base Metals Long ETN – (Ticker BDG)
PowerShares DB Base Metals Short ETN – (Ticker BOS)
BMO Base Metals Commodities Index ETF – (Ticker ZCB-TSX)
BMO S&P/TSX Global Base Metals Hedged to CAD Index ETF – (Ticker ZMT-TSX)
ETFS Forward Industrial Metals ETF – (Ticker FIND-LSE)
ETFS Industrial Metals ETF – (Ticker AIGI-LSE)
ETFS Leveraged Industrial Metals ETF – (Ticker LIME-LSE)
ETFS Short Industrial Metals ETF – (Ticker SIME-LSE)
Read more about commodities in our all-encompassing guide ‘How to Invest in Commodities‘, which highlights alternative methods of investing or gaining exposure to commodities. You may be surprised at the number of options now available to private investors, in such a relatively new and rapidly expanding retail marketplace. Base metal ETFs are just the beginning!