Investing In Copper ETFs? Start Here…

| March 25, 2015 | 0 Comments

copper ETFsDoctor Copper, as the base metal copper is often called, is one indicator of economic and market health many investors pay close attention to.

It’s called a doctor because it’s said to have a PHD in economics.  The price fluctuations in copper often predict turning points in the global economy and the stock market.

In other words, copper is believed to be a leading indicator of economic health.

It makes sense…

Copper is used in many different sectors of the economy.  So, if prices are going up, it’s often because demand is going up because the economy is doing well.  And on the other hand, if prices are falling, it’s because demand is slowing as the economy slows.

Needless to say, it’s not an infallible indicator.  Changes in the supply of copper can lead to rising and falling prices as well.

But more often than not, rising copper prices are an indication of strong copper demand and an accelerating economic growth.  And declining copper prices indicate slowing demand and a slowdown in economic activity.

And you can use ETFs to invest in copper.

What’s a copper ETF?

Copper ETFs are exchange traded funds that track the price and performance of copper.  You don’t ever have to own, store, or take delivery of the actual metal.

Some copper ETFs own stocks of copper producers and miners.  Other ETFs invest directly in copper futures and derivative contracts so they track the price of copper.

Who should buy a copper ETF?

If you’re looking for a simple way to invest in Dr. Copper or have exposure to the copper industry, you’ll be interested in copper ETFs.

The best thing about ETFs is you don’t have to select individual stocks to invest in.  An ETF holds an entire basket of stocks.

There’s nothing worse than identifying an investment opportunity in an industry that doesn’t work because you bought the wrong companies’ stock.

It happens all the time… two similar companies in the same industry can perform very differently.  If you invest in the wrong one, it can ruin a great opportunity.

With an ETF, you don’t have to worry about picking the wrong stock.  The ETF holds many stocks.  As long as you have correctly identified the opportunity in the industry, you don’t have to worry about company specific problems derailing your investment.

For example, if you buy the Global X Copper Miners ETF $COPX, then you’re buying the 30 copper mining stocks that the ETF holds.  And you’re doing it in a single trade.

Or you can buy the United States Copper Index Fund $CPER.  It tracks an index of copper futures contracts.  So the value of the investment tracks the price of the metal.

These ETFs are a simple way to invest in copper miners or copper right in your IRA or brokerage account.  

How do I invest in copper ETFs?

These aren’t the only ETFs you can use to invest in copper.  There are many different copper ETFs to choose from.

Here’s how you can find even more copper ETFs.

A good first step in to create a list.

This will put you on the fast track to investing in copper ETFs.

Good Investing,

Corey Williams

Note: Corey Williams writes and edits   Sign up for our free ETF reports and free e-letter at We’re devoted to helping you make more money from ETFs.

Tags: , , , , ,

Category: Commodity ETFs

About the Author ()

Corey Williams is the editor of Sector ETF Trader, an investment advisory service focused on profiting from ETFs and the economic cycle. Under Corey’s leadership, the Sector ETF Trader has become one of the most popular and successful ETF advisories around. In addition to his groundbreaking service, Corey is the lead contributor to ETF Trading Research, where he shares his insights about ETFs and financial markets three times a week. He’s also a regular contributor to the Dynamic Wealth Report and the editor of one the hottest option trading services around – Elite Option Trader.

Leave a Reply

Your email address will not be published. Required fields are marked *