ETFs

2 new ETFs are coming soon to the ASX: Uranium and Solar

Fri 27 May 22, 11:56am (AEST)
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Key Points

  • BetaShares will launch two new ETFs in the coming months
  • The Solar ETF will provide exposure to leading global solar manufacturers, inverter suppliers and solar tech
  • The Uranium ETF invests in global miners and explorers, uranium refiners and nuclear energy

Leading ASX-listed ETF provider BetaShares will soon launch two new ETFs focused on alternative energy sources - solar and uranium.

Note: the ETFs are still subject to regulatory approval, tickers are indicative

Solar ETF (ASX: TANN)

According to BetaShares, the Solar ETF will provide investors exposure to leading global companies in the solar industry. This includes:

  • Solar panel manufacturers

  • Inverter supplies

  • Installers

  • Manufacturers of solar-powered charging

  • Energy storage systems

  • Solar project finance companies

Macro theme behind solar

Solar is becoming an increasingly viable low-cost option for electricity generation, even in the midst of surging commodity prices.

The International Energy Agency estimates that solar's contribution to total electricity production will grow from circa 3% in 2020 to circa 30% by 2050.

2022-05-27 11 11 53-Window
Source; International Energy Agency (Nov 2021)

Peer comparison

There is a US-listed Solar ETF (NYSE: TAN) that's operated by Invesco. Both Betashares and Invesco ETFs should theoretically be very similar in nature and composition.

The ETF's top 3 holdings (as at 05/25/2022) include:

  • Enphase Energy (10.92% of fund)

    • Nasdaq-listed solar energy management company

  • SolarEdge Technologies (8.70%)

    • Nasdaq-listed, manufactures solar inverters and monitoring systems

  • GCL Technology (6.72%)

    • Hong Kong-listed develops and manufacturers PV materials used for solar panels

The ETF is down -11.2% year-to-date and does not pay dividends.

2022-05-27 11 20 44-Window
Source: TradingView

Global Uranium ETF (ASX: URNM)

The Uranium ETF will provide investors exposure to companies involved in:

  • Mining and exploration

  • Extraction and refining

  • Nuclear components and energy

  • Holding physical uranium and/or uranium royalties

Macro theme behind uranium

Nuclear energy adoption is on the rise after a decade long bear market, triggered by the 2011 Fukushima nuclear disaster.

Nuclear energy is viewed as a safe, reliable and low-carbon energy source that can supplement the world's transition towards renewable energy.

The lack of investment into new uranium capacity and increasing pipeline of new nuclear power plants, notably from China, paints a bright outlook for the industry.

2022-05-27 11 35 31-Window
Uranium spot price (Source: TradingEconomics)

Peer comparison

The BetaShares Global Uranium ETF should in theory be very similar to the Global X Uranium ETF (NYSE: URA).

The Global X ETF's top holdings (as of 05/25/2022) include:

  • Cameco (22.29% of net assets)

    • Toronto exchange-listed

    • One of the world's largest uranium miners

  • Sprott Physical (6.84%)

    • Toronto exchange-listed

    • Buys and holds physical uranium

The ETF has smaller allocations in ASX-listed names including Paladin Energy (ASX: PDN), BHP (ASX: BHP) and Boss Energy (ASX: BOE).

The ETF is down -3.3% year-to-date and does not pay dividends.

URA 2022-05-27 11-40-20
Global X Uranium ETF (Source: TradingView)

 

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Written By

Kerry Sun

Finance Writer & Social Media

Kerry holds a Bachelor of Commerce from Monash University and was Vice President of the University Network for Investing and Trading (UNIT). He is an avid swing trader, and drawn to breakouts and technical set ups. Outside of writing and trading, Kerry is a huge UFC fan, loves poker and bouldering.

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