Like all articles on our ETF Infos site, this short overview is meant to provide readers without much previous exposure to copper ETFs or commodity ETFs in general with a short but comprehensive copper ETF list including the relevant copper ETF symbol. This compilation will give you basic copper ETF information and a first impression of available funds to choose from for a possible investment in copper.
Overview of Available ETFs
Currently, five Exchange-Traded Funds fulfill the requirements for a targeted copper investment. In general, as with any commodity ETF, there are three ways to track the price of copper with an ETF: first, by actually buying, storing and selling physical copper. Second, by holding copper future contracts, and third, by holding stocks of companies active in the mining and extraction of copper. Of the five funds presented in our copper ETF list below, two fall in the second category and three in the third. Some of them, however, do not only target copper, but also other industrial metals such as nickel and aluminum.
Currently, there are no ETFs for physical copper available, however, two major fund managers (iShares and JPMorgan) have applied for the permission to start such funds.
The Five Copper ETFs Currently on the Market
- iPath Dow Jones-UBS Copper ETN (JJC)
This is the “cleanest” copper-tracking fund on the market, targeting the Dow Jones-UBS Copper Subindex Total Return index, which currently consists of the single Copper High Grade Futures contract as traded on COMEX. Being based on futures, it carries the general risk of roll-over costs common to all future-based index funds. As the futures price curve is presently inverted, however, future prices are lower than the current spot price. This is at the moment an advantage for the fund.
This fund is not a real ETF, but an ETN, which is actually a senior debt issued by the fund’s managing bank Barclay’s. Therefore, it is subject to counterparty risk.
Its expense ratio is 0.75% and its tracking error is currently 0.57%. The copper ETF symbol is JJC.
- PowerShares DB Base Metals ETF (DBB)
This is the second futures-based ETF with an exposure to copper. Unlike the JJC, it tracks the DBIQ Optimum Yield Industrial Metals Index Excess Return index. This index contains futures for the three industrial metals copper, nickel and aluminum in almost equal shares, so that only about 35% of the index is due to the copper price.
Its expense ratio is 0.75% and its tracking error is currently 0.76%. The copper ETF symbol is DBB.
- First Trust ISE Global Copper Index Fund (CU)
This ETF is the first of three funds based on copper mining-related stocks. It tracks the ISE Global Copper Index, which consists not only of copper mining companies, but also of extractors of other metals. The index tries to approximate a true copper-only exposure by weighting the share of each company by the percentage of its revenue made with copper mining only. Geographically, over two thirds of the mining companies in the index are located in Canada and Europe, with Canada and the United Kingdom alone making up over half of the index.
Its expense ratio is 0.70% and its tracking error is currently 0.61%. The copper ETF symbol is CU.
- Global X Copper Miners ETF (COPX)
The COPX tracks the Solactive Global Copper Miners Index, which consists of stocks of pure copper mining companies only. While there is significant overlap with the CU fund, in includes several smaller miners as well. Its geographical exposure is even more strongly concentrated on Canada and Europe at over 75%, again with Canada and the United Kingdom being responsible for more than two thirds of the index.
Its expense ratio is 0.65% and its tracking error is currently 0.48%. The copper ETF symbol is COPX.
- Emerging Global Shares Emerging Markets Metals & Mining ETF (EMT)
This stock-based ETF again invests in mining and extraction companies active in the field of industrial and precious metals, such as copper and nickel, and gold and platinum, respectively. While its copper exposure is lower than 50%, its unique aspect is its geographical focus on miners in emerging markets. In these countries, the demand for copper has increased significantly in recent years, favoring these mining companies.
Over half of the miners making up the Dow Jones Emerging Markets Metals & Mining Titans Index tracked by the EMT fund are located in Asia and Latin America, mainly in China and Brazil, with a significant minority in South Africa.
Its expense ratio is 0.85% and its tracking error is currently 0.78%. The copper ETF symbol is EMT.
This basic copper ETF information is meant to provide an overview of which investment opportunities exist in the copper ETF market. With the possible start of physical copper ETFs in the near future, this copper ETF list will be expanded to include any newcomers.