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China Poised To Fire Up The Market Vectors Coal ETF (KOL)

|Includes: VanEck Vectors Coal ETF (KOL)

china-coal-industry“Coal accounts for more than 70% of China’s electricity,” says Tony Sagami.  In Uncommon Wisdom, he looks to an ETF poised to benefit from long-term rising coal demand.

“Between coal-fired power plants and steel production, the demand for coal is going to be steady and reliable for decades to come. My point is pretty simple and one that I’ve repeated many times: you have to get long whatever China is buying,” The Stock Advisors Report.

Something to consider is this “Let this statistic sink into your brain — China is activating one new coal-fired plant every week of the year. The reason for the high demand is simple: Per unit of energy delivered, coal costs about one-fifth as much as oil,” The Stock Advisors Report.

The ETF he is referring to is the Market Vectors Coal ETF (NYSEARCA:KOL), which offers direct exposure to the coal industry and allows you to get in on what China is buying.  The investment (KOL) seeks replicate as closely as possible, before fees and expenses, the price and yield performance of the Stowe Coal index. The fund normally invests at least 80% of total assets in equity securities, which may include depositary receipts, of U.S. and foreign companies principally engaged in the coal industry. It normally invests at least 95% of total assets in securities that comprise the index.

Take a look at the top holdings within the ETF (KOL) below:

TOP 10 HOLDINGS (KOL) ( 62.42% OF TOTAL ASSETS)  
 
Company Symbol % Assets
Bucyrus International, Inc. (NASDAQ:BUCY) 5.2
China Coal Energy Co. Ltd. N/A 8.47
China Shenhua Energy Company Limited N/A 7.76
CONS ENERGY INC (NYSE:CNX) 6.58
Joy Global Inc. (JOYG) 7.26
MASSEY ENERGY CO (NYSE:MEE) 4.86
PEABODY ENERGY CORP (NYSE:BTU) 5.87
PT Bumi Resources N/A 6.96
WALTER ENERGY, INC (NYSE:WLT) 4.31
Yanzhou Coal Mining Company Limited N/A 5.15

Chart for Market Vectors Coal ETF (<a href='https://seekingalpha.com/symbol/KOL' title='VanEck Vectors Coal ETF'>KOL</a>)

Disclosure:  No Positions