Since direct investments in nuclear power are not possible, investors have turned towards the equity market for exposure. And thanks to the development of the exchange-traded fund industry, there are now several ways to gain access to this alternative energy source. Below, we outline the three most popular nuclear energy ETFs and which one will better fit your investment objectives.
Market Vectors Nuclear Energy (NYSEARCA:NLR)
Quick Stats (10/4/2012)
- Total Assets: $82.8 million
- Average Daily Volume: 36,000
- Expense Ratio: 0.61%
- In Depth: NLR Analyst Report and ETFdb Realtime Rating
Van Eck’s NLR is by far the largest and most popular option for investors looking to gain access to this intriguing alternative energy segment. Since inception in 2007, the fund has amassed nearly $83 million in total assets, and currently maintains a relatively healthy trading volume of over 36,000 shares a day on average. NLR has a shallow portfolio of just 20 individual holdings, the majority of which are large and mid cap stocks. In terms of country allocations, NLR has significant weightings towards the U.S. and Japan, but also features exposure to Canada, France, Australia, and Poland [see also 25 Ways To Invest In Alternative Energy].
NLR is Right for You if: You are an active trader seeking to either speculate on nuclear energy’s movements or quickly execute positions in the commodity.
Powershares Glob Nuc Energy (NYSEARCA:PKN)
Quick Stats (10/4/2012)
- Total Assets: $13.7 million
- Average Daily Volume: 1,700
- Expense Ratio: 0.75%
- In Depth: PKN Analyst Report and ETFdb Realtime Rating
PKN is another popular option for investors looking to add nuclear energy exposure to their portfolios. The fund tracks an index that is designed to measure the overall performance of publicly traded companies engaged in the industry. PKN aims to spread its exposure across multiple sub-sectors withing thenuclear energy industry, including reactors, utilities, construction, technology, and fuels. The resulting portfolio consists of over 60 individual securities, which have a significant tilt towards stocks from the U.S. and Japan, but is much more concentrated in U.S. allocations than NLR.
PKN is Right for You if: You are an investor looking to achieve exposure to the nuclear energy market, but want a greater allocation to U.S. equities.
iShares S&P Global Nuclear Index Fd (NASDAQ:NUCL)
Quick Stats (10/4/2012)
- Total Assets: $10.5 million
- Average Daily Volume: 500
- Expense Ratio: 0.48%
- In Depth: NUCL Analyst Report and ETFdb Realtime Rating
Although iShares’ NUCL is not as large or as popular as the other ETFs on this list, it does have the lowest expense ratio, coming in at a mere 0.48%. NUCL also features a significant allocation to giant and large cap stocks, giving investors a relatively “safer” play on the nuclear energy industry. Like the other two ETFs, NUCL is biased towards U.S. and Japanese equities, but Canada, the United Kingdom, and Germany also receive meaningful allocations. Since its debut in 2008, the fund has accumulated over $10 million in total assets, buts its average trading volume comes in at a rather dismal 500 shares a day [see also Why Alternative Energy Will Never Become Widespread (In Our Lifetime)].
NUCL is Right for You if: You are a cost-conscious investor looking to gain exposure to nuclear energy equities, but want a greater allocation to “safer” giant and large cap stocks.
This article was originally written by Daniela Pylypczak, and posted on CommodityHQ.