VanEck has expanded its thematic range with the launch of an ETF targeting the uranium and nuclear energy industries, ETF Stream can reveal.
The VanEck Uranium and Nuclear Technologies UCITS ETF (NUCL) is listed on the Deutsche Boerse with a total expense ratio (TER) of 0.55%. The ETF will list on the London Stock Exchange at a later date.
NUCL tracks the MarketVector Global Uranium and Nuclear Energy Infrastructure index which captures 25 companies involved in nuclear energy, uranium mining or offering exposure to spot uranium.
Constituents include the world’s largest listed uranium miner Cameco, UK-based physical uranium trust Yellow Cake, nuclear power plant operator Korea Electric Power Corporation and supplier of nuclear energy components to the US government BWX Technologies.
Companies involved in the development of nuclear innovations such as fusion technology or molten salt reactors may be included in the future.
NUCL can also allocate weightings of up to 5% to companies deriving under 50% of their revenues from uranium or nuclear activities, given the lack of liquid pure-play companies in the nuclear power sector, VanEck said.
The ETF only captures stocks with a market cap of at least $150m and their weights in the underlying index cannot be higher than their average daily trading volume divided by $500,000.
The top constituent is capped at 15%, the second-largest weighting 10% and the remaining constituents are capped at 8%.
Its index also applies ESG screens excluding companies that commit very serious violations of social norms, engage in the sale of controversial firearms or exceed revenue thresholds for sectors including fossil fuels.
Commenting on the launch, Martijn Rozemuller (pictured), CEO of VanEck Europe, said: “Uranium has recently regained significant relevance as a low-carbon energy source. In view of recent geopolitical developments and the debate on the independence of the European energy supply, nuclear power as an energy source and uranium as a raw material are becoming increasingly important.
“The EU seems to recognise this and has recently included nuclear energy in the EU's climate taxonomy. In addition, researchers in the US achieved a breakthrough in nuclear fusion in December 2022.
“This future technology, as well as new approaches such as liquid salt reactors, could make a very large contribution to our energy supply in the medium and long term.”
Kamil Sudiyarov, product manager at VanEck Europe, added: “France, Europe's leading nuclear energy producer, announced in 2022 that it plans to commission at least 14 new nuclear power plants by 2050 to renew its power grid.
“The Dutch government has also announced plans to build two new reactors to make the country less dependent on fossil fuels.”
The arrival of NUCL follows the launch of the Global X Uranium UCITS ETF (URNU) and Sprott Uranium Miners UCITS ETF (URNM) in April 2022.
These were the first ETFs offering exposure to nuclear since the ETFS WNA Global Nuclear Energy GO UCITS ETF (NUKE) delisted in 2014.
It also comes after the European Commission asked the European Supervisory Authorities (ESA) to suggest changes to how companies disclose their involvement in fossil fuel and nuclear activities under the Sustainable Finance Disclosure Regulation (SFDR) last September.
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