Battle Of The Battery Metal ETFs: BATT Vs. LIT

by:CTECHi     2020-03-31
There is a new competitor in the subject ETF field, which aims to provide opportunities for accelerating global demand for advanced battery technology.
Amplify Advanced Battery Metals and Materials ETF (BATT) was launched on the New York Stock Exchange 6/18.
BATT is an actively managed ETF designed to provide exposure to lithium, cobalt, nickel, manganese and graphite used in advanced battery chemicals.
BATT\'s company is mainly engaged in mining, exploration, production, development, processing or recycling of advanced battery metals and materials.
So why do investors want access to lithium?
First is the ion battery supply chain?
The investment story is indeed a case study for economics 101.
With regard to battery metals, limited supply, coupled with increased global demand.
What are the key factors driving lithium demandion batteries? Lithium-
Ion batteries are pushing for a technological revolution.
5 times the energy density of the lead battery, rechargeable lithium-
Ion batteries power mobile devices such as smartphones, tablets, laptops, robots and drones.
While technological advances and lower costs drive lithium
In the past few years, the ion batteries of mobile devices have been booming, and the next demand will come from electric vehicles and energy storage to power the future of green technology.
The biggest reason for demand growth is the growing global demand for electric vehicles.
Bloomberg New Energy Finance forecasts transportation demand for lithium
Soon, consumer electronics, including smartphones, will demand more than ion batteries.
Source: Bloomberg.
What is the percentage of growth we are talking about?
Different estimates.
According to Orbis Research, lithium worldwide
The ion battery market, which accounts for $29.
86 billion in 2017, $139 is expected.
Between 36 billion and 2026, it grew at an impressive compound annual growth rate (CAGR) of 18. 7%.
But Goldman Sachs predicts that, driven by an increase in electric vehicle battery production, battery demand will grow at a CAGR of 32% by 2025.
At the end of 2017, the global penetration rate of electric vehicles in the automotive market was only 1%.
Keep in mind that the electric car battery is about 4,500 smartphones!
This means an acceleration of growth space and related demand.
What is the driving force for the growth of electric vehicles?
The government\'s goal in fuel efficiency and emissions will further motivate automakers to boost production of electric vehicles.
More and more countries are promising to ban or at least limit the sales of internal combustion engine cars in the coming decades as part of efforts to reduce air pollution.
China is now the world\'s largest electric vehicle market, with the highest growth rate in sales of electric vehicles.
Electric vehicles currently account for only 3.
With 3% of China\'s auto market, pollution problems in China are more likely to be electrified.
It has been leading the way in step-by-step subsidies, penetration targets, investment and the number of electric vehicle models with over 100 options.
The government strongly encourages consumers to buy electric vehicles, the only way to ensure license plates are obtained in crowded cities.
In 2017, China sold more than 600,000 electric vehicles, up 71% from the previous year.
China is focusing on the sales quota for electric vehicles, which may mean that electric vehicles or plug-in cars will become the fifth new car by 2025in.
China is also a major player in lithium
About 55% of the world\'s lithium-ion battery supply side
In contrast, the output of ion batteries in the United States is 10%.
Lithium in China
The supply of ion batteries is expected to grow to 65% by 2021.
Another factor that supports more adoption of electric vehicles is that battery prices continue to become cheaper.
Average price of lithium-
The ion battery pack dropped to $209/kilowatt-
By 2025, hours and prices will drop further below $100/kWh.
For large-scale adoption, the price of electric and hybrid cars needs to be comparable to that of natural gas
Electric cars without subsidies.
According to a survey by Bloomberg New Energy Finance, lithium-
The price of ion batteries has dropped by more than 70% since 2010.
Tesla\'s battery price hovered around $400 a kilowatt hour a few years ago and is now close to $150 a kilowatt hour.
Global automakers have pledged $90 billion in electric vehicles and battery technology, including $19 billion in the United States, $21 billion in China and $52 billion in Germany.
Volvo in China
The Swedish brand has announced that it will stop producing traditional natural gas.
Electric cars in 2019.
The biggest investment comes from Volkswagen, which plans to spend $40 billion by 2030 to make an electrified version of its 300 cars.
Plus global models.
Some of the biggest obstacles-
Market penetration is a climate impact on battery performance and a challenge for charging infrastructure.
Electric vehicle manufacturers have implemented many solutions to solve temperature problems, including changing battery design, improving battery management systems, climate grading systems, and pre-processing of engine rooms.
In addition, faster charging time and larger charging capacity are expected to go online, which helps to reduce \"range anxiety\" and further promote the public. Market adoption.
Global demand for lithium is growing
Ion batteries that supply electricity to consumer equipment, electric vehicles and grid storage, coupled with limited supply and capacity, create conditions that continue to push up the price of battery metals and mining stocks.
This has also stimulated investment activities in the field.
This growth trend creates significant opportunities for investing in the fundamental elements contained in lithium
In view of the limited capacity of the supply to meet the growing demand for lithium, Ion batteries such as: Source: EQM index-
The prices of ion batteries, potential battery metals, and companies that mine them should continue to rise.
Investors in companies that develop and produce battery metal may be rewarded.
Investors may get investment in battery metals and mining companies through direct investment, but many key players in the field live outside the United StatesS.
Mainly in Canada, Australia, South America and China.
Many of these companies only trade local stock versions that are difficult for the United States. S.
Investors visit.
Exchange-traded funds (ETFs) provide investors with a great tool to diversify their investments in this growing global trend.
Let\'s compare the two purest.
Game Options: The New amplified premium Battery Metals and Materials ETF and the Global X lithium battery technology ETF (ETF ).
Until recently, WhatsApp was the only ETF option with a lithium theme
Ion battery growth.
Over the past few years, Groupon has achieved great success in attracting investors\' assets.
ETF-managed assets are just under $1 billion, currently at $997. 7 million.
The new player BATT was launched in June 6, 2018 for $2 million.
So what is the biggest difference between these two ETF options?
The following is a comparison table for review: * according to the contract agreement, the fund investment consultant agrees to waive the management fee of 0.
As of May 23, 2019, the average net assets per day was 20% per cent. 1.
Passive management.
BATT active management is passively managed, tracking the Solactive Global Lithium Index while BATT is actively managed, but referring to holdings of the EQM battery metals and mining index.
Groupon\'s stake was refreshed in the semi-finals.
The holdings of BATT will change on a positive basis.
However, since BATT\'s initial fee reduction is 0, their fee ratio is currently roughly the same. 20%. 2. LIT Market Cap-Weighted vs.
The equal weight (Smart Beta) review modified by BATT is weighted by market value, while BATT is in each metal Category: lithium, cobalt, nickel and others (manganese, graphite, recycler ).
As a result, riot is more concentrated in its top 10 names, accounting for 77% of its weight, while BATT is only 34% and more diverse. 76. 5%33. 6%3.
Groupon and BATT offer different market capitalization, and the market capitalization weights of exposuresoft distort their composition to a larger market capitalization, and have some large weights in the largest companies.
BATT has a greater weight in the name of the small hat.
The hood is a big cap of 66%, while the BATT is only a 33% cap of 6/6/18. 4.
Groupon and BATT have little overlap in names and offer different market exposures. The overlap between the two ETFs is very low, with only 8.
20% of the shares in BATT are also in BATT, while 31% of the shares in BATT.
As the name implies, the biggest difference in the composition of the stock ownership is that the company mainly has access to lithium shares and battery technology.
In contrast, BATT is a pure
Play with materials and potential battery metals and contact with lithium cobalt, nickel, manganese, graphite and metal recycling companies. 5.
Thanks to its market value-weighted structure, the fair and BATT offer a very different country/region, with the United States at £ 45%S.
BATT is only $ 8%. S.
Thanks to heavy loads in Canada and Australia, the Oasis is 70% developed markets and the BATT is 81%.
As of 6/18 amplify\'s advanced battery metals and material ETFs, holdings data for the iPads and BATT provide clear exposure to the base metals used in lithium
Not just lithium batteries.
BATT gives investors access to other metals used in battery chemistry today, such as: cobalt, nickel, graphite and manganese.
Compared with the Global X lithium battery technology ETF, this provides a good diversified advantage.
Investors should decide how best to leverage the global growth trends associated with accelerated demand for battery technology related to electronics, electric vehicles and storage solutions.
The growth of battery metal demand is conducive to the supply of BATTbased. LIT\'s end-
Users such as battery manufacturers, energy storage and electric vehicle manufacturers should also benefit from the growing global demand for battery technology, but rising input prices will suffer due to limited supply.
In our view, BATT\'s investors provide clear exposure to companies developing and producing battery metal
One side is likely to get a long-term returnterm.
However, given the smaller market capitalization of these companies and the greater access to emerging markets that trade overnight, investors should recognize that BATT may fluctuate in the process.
The DisclosureEQM index is the creator\'s index of EQM battery metals and mining.
The direct investment index is not possible.
Through the index-based investable instruments, exposure to the asset class represented by the index can be obtained.
The EQM index does not sponsor, endorse, sell, promote or manage any investment fund or other investment instrument provided by a third party and designed to provide return on investment based on the performance of any index.
The EQM index does not guarantee that investment products based on the index can accurately track the performance of the index or provide positive return on investment.
EQM Indexes is not an investment advisor and does not state the feasibility of investing in any such investment fund or other investment instrument.
The decision to invest in any such investment fund or other investment instrument shall not rely on any statement on this website.
It is recommended that potential investors invest in any such fund or other instrument after carefully considering the risks associated with investing in such funds, detailed in a issuance memorandum or similar document prepared by an issuer of an investment fund or other instrument or its representative.
The inclusion of securities in the index is not a proposal for the purchase, sale or holding of such securities by the EQM index, nor is it considered an investment proposal.
I am/We are long Bart.
Business Relationship Disclosure: The EQM index creates the EQM battery metals and mining index and receives compensation from the enlarged etf associated with BATT for research and marketing support.
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