NUCLEAR ENERGY ETFs

NUCLEAR ENERGY ETF

A quick and brief check has shown there to be at least three ETFs being sold that address the nuclear energy industry.

The Market Vectors Nuclear Energy ETF (N-NLR) is by far the largest ETF of the three. At the present time it has about 25 component stocks, 35% of which are mining stocks with the rest being power generating plants, equipment manufacturers, engineering firms, etc. The Index calculation is based upon the weighted method with the top 20% of the stocks providing 40% of the Index value. There is only one mining stock in this top 20% and that is Cameco. This ETF is based upon and simulates the DAXGlobal Nuclear Energy Index.

The PowerShares Global Nuclear Energy Portfolio (N-PKN) is the other US traded ETF and much smaller than the Market Vectors ETF. At the present time it has about 65 component stocks with only 6 mining companies (less than 10%). It is more of a nuclear power generating and service industry ETF than one representing the mining sector. This ETF is based upon and simulates the WNA Global Nuclear Energy Index.

The ETFS WNA Global Nuclear Energy Fund is traded on the European Exchanges and I have little info (especially technical) for it. It is promoted by ETF Securities in the UK. Google ETF Securities for more info. This ETF is also based upon and simulates the WNA Global Nuclear Energy Index.

The NLR and PKN ETFs have a very similar performance and chart patterns but the NLR, being a larger fund has greater trading volume and clearer technical picture and information. I have shown the trading history for NLR from its top in early 2008 to the present as well as the Merv’s Daily Uranium Index for the same period, for comparison. Both have similar performances over an extended period although they do differ in performance over short periods. If you are not into buying individual stocks because you think that it is too risky but have bought into the concept of buying into ETFs as a less risky play, well these two may be your cup of tea (for North Americans). European investors should also check out the ETFS fund.

Again, one thing the charts show is that the buy and hold strategy is a losers strategy, even for ETFs. One still needs to have some idea of timing of purchases AND sales. For intermediate term “investors” one could just follow my BULL and BEAR intermediate term ratings for the Merv’s Daily Index and be quite comfortable. For the more aggressive “trader” a simple concept of buying and shorting on the slope changes of the short term moving average line has done pretty good service even though there were times you might have lost a little capital along the way. BUT traders expect to lose some trades and are quick to keep losses small.

I should be updating my LINKS section shortly so that there is a link to all three of the mentioned ETFs and any others that may come into knowledge in the future.