iShares Copper and Metals Mining ETF (ICOP)

Chamath Palihapitiya, also known as the SPAC King, just revealed his top investment idea for 2026.

AI-driven demand and tight supply pushed copper above $12,000 a ton, setting the stage for diversified copper ETFs like COPX as a 2026 trade.

The iShares Copper and Metals Mining ETF is heavily weighted to copper but also has some iron ore and gold exposure. ICOP's 27.46x P/E is driven by copper stocks, reflecting high valuations associated with the well-understood electrification trends and spot price lift due to tariff speculation. Copper remains strong due to electrification demand and supply constraints, while iron ore faces headwinds from Chinese pressure on iron ore sellers as the major global steel producer.

Copper's bullish trend is supported by technical and fundamental factors, with global deficits expected to persist into the 2030s. U.S. tariffs have caused extreme volatility and a shift of copper inventories from LME to COMEX warehouses, distorting traditional price relationships. Freeport McMoRan shares experienced sharp volatility due to Indonesian production issues, but Citi upgraded FCX on expectations of $12,000 copper in 2026.

The Global X Copper Miners ETF offers diversified exposure to global copper mining equities, which tracks the Solactive Global Copper Miners Total Return Index. COPX's performance is highly correlated with copper prices, which are heavily influenced by Chinese industrial demand and global economic trends. COPX is the largest and most liquid copper miners ETF, with a 1.51% yield and a 0.65% expense ratio.

Copper ETFs have seen a surge in investor popularity, driven by geopolitical tensions and recent tariff-related news. President Trump declared a 50% tariff on copper.

Look at ETFs to capitalize on the red metal's bullish trend, driven by renewed investor demand and the Fed's interest rate cut.

Copper prices have surged Tuesday, reaching their highest levels in nearly six weeks, according to CNBC. In New York, copper for September delivery briefly touched $4.3065 per pound on Tuesday, the highest since mid-July, before settling at $4.2365, up 0.4% for the day.

Halfway through the year, thematic equity ETFs have exhibited wide levels of dispersion but continue to capture the market's attention heading into the second half of 2024.

Looking at the ETFs with the highest returns YTD, a few thematic standouts have emerged.  As a reminder regarding  long-term investments, thematic investing is cyclical.

Wall Street is on track for its worst month in 2024. The decline has been broad-based.

One of this year's thematic surprises has been the outperformance of copper and copper-themed ETFs. There have been outsized returns ranging from 16% to over 20% YTD.

Copper prices soared to an 11-month high following an agreement by Chinese smelters to cut production. Investors should tap this strong trend with ETFs.

It was a busy week for ETF launches and closures. A total of 15 ETFs launched during the week shortened by the Juneteenth holiday, defying the typically slow launch count for weeks surrounding three-day weekends.