A White Paper on Lithium ETF Investments

The ease of connecting with the entire world with just a dab of your finger may still have been in the realms of science fiction only, if it was not for the superb energy storing capacities of the Lithium Carbonate cells that power more than 90% of the portable and digital networking devices in the world.

With no substitute in sight, demands for this metal are rising and market veterans are already sold long term on Lithium ETFs and related equity (as physical exposure to Lithium is not possible as yet).

As the internet and technology sectors are penetrating newer milestones and becoming readily available to the consumers of the fresher emerging markets, the supply and demand disparity for the mineral will arise sooner than the streets think.

Lithium Funds and stocks may have seen some downside recently but the probable game changer for them in the current year will be huge demand for portable digital devices arising from the developing countries and their vast numbers of middle class population, who with their new found economic status and increased disposable incomes are almost competing with each other to own the latest laptop or the most advanced smart phone before any one else does.

It is also important to note that Lithium is found only in the top layer of the earth's crust which makes it a rare metal.

No wonder a handful of miners and explorers almost dominate the capital markets which are valued at upwards of a billion dollars annually.

Lithium charged batteries and cells have radically transformed the electronics industry to as we know it today. The ringing cash registers of companies like Apple and Toyota is owing to the sale of their products that rely completely on lithium carbonate cells; major bestsellers in this category being the I phones and Toyota's hybrid car.

Wall Street firms including JP Morgan and Black Rock Investments have time and again raised their outlook on the concerned equity since 2010 and have indeed made gains as well, largely due to their well researched and well timed exposures to Lithium stocks; A strategy they applied to indirectly tap on the growing sales of popular products that use these ultra light and ecologically cleaner batteries.

Equity investments in Lithium may not be suitable for the common folk as it requires an insight in to these other wise lesser known stocks but investors seeking to add exposure may consider NASDAQ listed Lithium ETFs which will include the most major miners and the battery manufacturers from around the world and enable a 360 degree exposure to the charged metal.

Apart from being bench mark bound Lithium Equity funds ensure enough savings for investors in terms of annual operational charges when compared to direct investments in stocks and more over the asset basket strategy discounts for risks that may occur due to an individual company wise downside or due to a geographical reason.

The demand for laptops, mobiles and electric cars is growing every day in the developed as well as the developing world thus it is quite understandable to see the Lithium miners and battery produces ramping up their operations to meet up with the increased industrial demand of the element which is growing at a powering rate of 24% per annually and the surge will easily continue till 2021.

The industrial consumption of Lithium Carbonate has doubled itself many times over since the popularity of Lithium cells rose in 2003.

Acquiring a partial exposure to Lithium Invest may make all the more sense after the recent battering of the associated stocks where some of the miners have seen haircuts of as much as twenty five percent.

With a strategic entry and if the universal logic of supply and demand is to believed then there is only one way where the pure play Lithium funds would be headed in the current fiscal year.

at 12:28 AM
Back to Top