Dig Up Some Strategic Metals

The most important development in commodities lately is the rising demand for strategic metals that are essential for many technologies, especially electronics, mobile communications, and advanced military products.

Unlike copper, iron, and zinc — that are abundant and widely distributed in the world — strategic metals are not available in large quantities from multiple sources. Significant supplies of lithium, for example, are only available from economically viable sources in China and Chile.

In addition to lithium, the list of strategic metals includes, chromium, manganese, niobium, titanium, tungsten, vanadium, and several others that people have in their computers, smart phones, and dozens of additional products. Electric vehicles — especially their batteries — are another high growth technology that requires strategic metals.

With the global economy starting to recover from the COVID-19 pandemic — and with the sharp increase in international tensions — many companies and government agencies are scrambling to expand their strategic metal stockpiles. The result is a new bull market for strategic metals that’s likely to last several years.

There are so many strategic metals and minerals that are only available from specific sources – the only practical way to invest in them is through a diversified fund. The best of the group is the VanEck Vectors Rare Earth/Strategic Metals ETF (REMX) that reflects the movements of the MVIS Global Rare Earth/Strategic Metals Index.


REMX One-year chart

The index includes the world’s leading companies that mine, refine, and recycle the Earth’s rarest and most essential elements. Basic minerals represent over 90% of the available investments in the sector. If you want to make a strategic metal investment, I think REMX is the best way to go.

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