Global Palladium Fund launches ETC for metals used in electric vehicles

Investors can now get access to commodities essential for the transition to electric vehicles.

Global Palladium Fund, a metals distributor established by Russian base and precious metals producer Nornickel, has launched the GPF Physical Electric Vehicle Metals Exchange Traded Commodity (ETC), which combines metals essential to the energy transition and electric vehicles.

• New gold: What metals are worth investment in 2022?
• Nornickel fund launches carbon neutral nickel ETCs on Wiener Börse
• Nornickel brings FPIC standards to Russia for first time

The new instrument gives investors a balanced opportunity to cash in on metals in demand on the fast-growing electric car market, according to Anton Berlin, Nornickel’s vice president for sales and distribution.

“We believe that this digital instrument is a great way for investors to access the commodities essential for the global decarbonisation process and hence enjoying rising demand today,” he adds.

Global Palladium Fund CEO Alexander Stoyanov notes that the “mega trend” to replace the internal combustion engine with the electric one is just at its beginning, and that the new ETC offers investors an alternative to high-risk equities, as it is still uncertain which companies will rule the new market.

First listed on Borsa Italiana, the contract will also be available at Deutsche Börse, London Stock Exchange and SIX in a few weeks, Nornickel confirmed.

The metals backing the ETC are stored at LME warehouses in Rotterdam and LPPM vaults in London and Switzerland, the company added.

Weighting

The initial weight of metals in the basket will be 40 per cent for copper, 28.13 per cent for palladium, 18.65 per cent for nickel, 11.45 per cent for cobalt, and 1.77 per cent for platinum.

It will be annually revised in July to reflect evolving use of metals across the different segments, with a possibility to introduce additional metals subject to use and availability.

The new ETC tracks the performance of the Solactive GPF Electric Vehicle Index, which is made up of metals based on their use across four electric vehicle segments: battery (BEV), hybrid (HEV), plug-in hybrid (PHEV) and fuel cell (FCEV).

Last year, the Global Palladium Fund launched physically backed palladium, platinum, gold, silver, copper, nickel, and carbon neutral nickel ETCs.

This content has been produced in collaboration with an Emerging Europe partner organisation.