For Base-Metal Investors This ETF Could Be The Right Pick Now

Wire, Copper, Electric, Stop, Closeup, Metal, Recycling

Rising inflationary pressures on the back of central bank liquidity and government stimulus, a falling U.S. dollar, increasing demand for worldwide infrastructure building, green technology, and other industrial applications create an almost perfect bullish storm for the ferrous and nonferrous metal. Hence, the iShares MSCI Global Metals & Mining Producers ETF (PICK) has risen to the highest price level since 2012. Because the trend remains bullish, we think investors would be remiss not to take a close look and consider taking a position in this fund.

In March 2020, copper fell to a low of $2.0595 per pound, the lowest price since June 2016. The red metal fell as the global pandemic spread worldwide, causing businesses to grind to a halt and all asset prices to plunge.

From April 2020 through May 2021, copper has made a remarkable recovery, as the price of nearby COMEX futures rose in 12 of the past 14 months. Furthermore, the red metal that is a building block of infrastructure, a critical component in green technology and many semiconductors and a bellwether commodity for the global economy hit an all-time high on Friday, May 7. The price surpassed the 2011 all-time peak on COME futures at $4.6495 per pound.

Copper is the leader of the base metals that trade on the world’s leading nonferrous metals forward market, the London Metals Exchange. Aluminum, nickel, lead, zinc, and tin prices have also rocketed higher, following copper’s lead.

The companies that extract the ores and metals from the earth’s crust are experiencing an earning boom not seen since 2011. The iShares MSCI Global Metals & Mining Producers ETF product holds shares of the world’s top base metals producers. PICK has risen to the highest price level since 2012. The trend remains bullish, and the trend in markets is always your best friend.

Base metals prices surge

Nonferrous metals are critical inputs for industry and infrastructure building. As central banks inject massive levels of liquidity into the world’s financial system and governments stimulate economic growth in the aftermath of the global pandemic, inflationary pressures are rising.

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