Due to its capability of feeding the fuel requirements of commercial nuclear power plants Uranium poses as the most important portion of the energy cake. This fuel source now accounts for 15% of the Global Power Generation. There are 437 operational nuclear power plants spread out in 30 countries. Out of which 68 are still under construction. According to (IAEA) International Atomic Energy Agency, by the year 2050 the world's Nuclear Capacity would have increased to 1,000 billion Watts.
As this form of energy is termed as Clean -Green form of energy, its production & use would have helped to eliminate 1.8 billion tons of carbon emissions from the earth's atmosphere.
2013 has definitely proved to be a good year for this alternative energy space. The green Technology Markets have suddenly seen a surge in the share prices.
The recent Climate Change Action Plan has resulted in a positive impetus for the Uranium industry. This trend towards the pro-clean energy environment makes a large number of clean energy ETF's benefit from the Obama's Climate Action Plan if the proposal is enacted. The top priority of this new plan is to reduce Carbon Pollution which is a result from Power Plants. Interestingly power plants account for one third of all greenhouse gas emissions in the U.S especially. So there seems to be an anticipatory positive trend and fruitful future for Uranium Investments.
These funds are not only an ideological answer, but it is important to understand that these funds invest in the Nuclear - centric utilities and put the assets in use for the mining space.
After the March 2011 Fukushima Daiichi Nuclear accident, there was a downward trend in the nuclear sector , but it is quite clear that this accident did not affect the demand for nuclear energy and hence the growth prospects of this Industry sees an increase of 23% in this sector in terms of capacity in the next 20 years. This is a good and potential time to return to the Uranium ETF's.
New emerging markets for this silvery fuel are expected to see an upward trend in their profits due to the boost in the demand for this silvery white metal.
Countries like China, India, Russia, Abu Dhabi, Turkey, Finland and Czech Republic are moving ahead with the construction of Nuclear Plants. According to (WNA) World Nuclear Association there are plans for 13 new reactors in the U.S.
There is an anticipation of a crunch on the supply side due to its increased consumption globally. In 2012 the consumption of Uranium was 165 million pounds in opposition to 152 Million pounds of its mixed production. Global Uranium stockpiles are being used to fill the demand and supply gap. Though the Uranium Mining Fund is not being backed up properly, investors can easily capitalize on these stocks through the Exchange Traded Funds.
Global X Uranium ETF [URA] corresponds to the price and yield figures of Solactive Global Uranium Fund. The underlying benchmarks show CAMECO CORPORATION (24.39%), URANIUM ONE INC (17.79), PALADIN ENERGY LIMITED (8.60%) and UR-ENERGY, INC. (5.44%) as its top Four Assets as of 7/3/2013. Global X URA fund issuers charge an annual fee of 69% from the participants.
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