USCF launches aluminum commodity ETF

Oct 9th, 2023 | By | Category: Commodities

United States Commodity Funds (USCF) has expanded its line-up of single commodity ETFs with a new fund that aims to capitalize on the burgeoning demand for aluminum.

Aluminum is a remarkably versatile metal and a fundamental component in a multitude of industries.

Aluminum is a fundamental component in a multitude of industries.

The USCF Aluminum Strategy Fund (ALUM US) has been listed on NYSE Arca and comes with an expense ratio of 0.65%.

Aluminum is a remarkably versatile metal and a fundamental component in a multitude of industries. Its low density, high reflectivity, thermal and electrical conductivity, non-toxic nature, and corrosion resistance make it indispensable across sectors such as aircraft and aerospace, automotive manufacturing, renewable energy, home appliances, building materials, and more.

As nations increasingly electrify their economies, the demand for aluminum, a vital component in various electrical applications, is expected to soar. Demand for aluminum is expected to increase by 40% by 2030, as reported by Cru International, a business intelligence company specializing in commodity markets, underscoring the potential for substantial returns on investments in aluminum-related assets.

Given its widespread use and the substantial demand from various industries, investing in aluminum has become an option that is increasingly on investors’ radars.

“Trading in aluminum futures has grown dramatically over the last year. The Chicago Mercantile Exchange reports nearly triple the number of open contracts and double the number of traders since last September,” said John Love, President and CEO of USCF Investments.

ALUM is actively managed by USCF, delivering exposure to the price performance of aluminum primarily by investing in futures contracts although the fund may also employ other instruments such as cash-settled options and forward contracts.

The ETF invests a maximum of 25% of its assets in a subsidiary incorporated in the Cayman Islands in order to enhance its exposure to aluminum while adhering to US federal income tax requirements.

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