Uranium ETFs: How to Play Bill Gates’ Nuclear Energy Bet

Uranium ETFs: How to Play Bill Gates’ Nuclear Energy Bet

Gates’ TerraPower breaks ground on next-gen nuclear power plant.

kent
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Research Lead
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Reviewed by: etf.com Staff
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Edited by: James Rubin

Bill Gates is betting on the future of nuclear energy as his next generation nuclear power plant, TerraPower, started construction last week. 

While his company is privately held, exchange-traded fund investors can gain exposure to nuclear energy’s growth potential with uranium ETFs. 

Nuclear power plants use controlled nuclear fission of enriched uranium to generate heat that boils water to create steam and spin turbines for electricity. 

Gates’ next generation nuclear power plant uses liquid sodium, which has a boiling point eight times higher than water’s. So, according to Gates, “it can absorb all the extra heat generated in the nuclear core,” limiting temperatures that might cause a meltdown. 

After last week’s groundbreaking event in Kemmerer, Wyo., Gates remarked in his blog that he expects the site “will soon be the bedrock of America’s energy future” and that the move represents “the biggest step yet toward safe, abundant, zero-carbon energy.” 

Why Is Nuclear Energy Trending?

Nuclear energy is trending amid escalating climate change concerns and geopolitical tensions, highlighting the need to shift toward clean energy resources and energy independence. 

  • Climate change concerns: As countries strive to reduce carbon emissions, nuclear power is gaining renewed attention as a clean energy source producing minimal greenhouse gases during operation. 
  • Energy security: Volatile oil prices amid the Russia-Ukraine and Israeli-Palestinian wars have highlighted the importance of energy independence. Nuclear power plants use domestic uranium fuel, offering a secure energy source compared to relying on imported fossil fuels.  

Nuclear Energy and Uranium ETFs

There are several nuclear energy ETFs available to investors. These funds invest in companies involved in the entire nuclear energy industry, from uranium mining to nuclear power plant construction and operation. Here are a few examples: 

VanEck Uranium & Nuclear ETF

The VanEck Uranium & Nuclear ETF (NLR) tracks the MVIS Global Uranium & Nuclear Energy Index, which includes companies involved in uranium mining, nuclear facility construction and maintenance, and nuclear electricity generation. 

Global X Uranium ETF

The Global X Uranium ETF (URA) primarily focuses on uranium mining companies but also includes some companies involved in other parts of the nuclear energy sector. 

Sprott Uranium Miners ETF

The Sprott Uranium Miners ETF (URNM) focuses on companies that mine uranium, with some investment in uranium exploration and development companies. 

Bottom Line on Investing in Uranium ETFs

Investors can potentially benefit from uranium ETFs through an increase in the underlying share prices of companies involved in the nuclear energy industry, driven by factors like rising uranium prices or growing demand for nuclear power.  

If the uranium price or the nuclear energy sector strengthens, an ETF that holds these companies should also appreciate in value. However, it's important to remember that uranium ETFs are a volatile investment, so there's also the risk of share prices decreasing. 

Kent Thune is Research Lead for etf.com, focusing on educational content, thought leadership, content management and search engine optimization. Before joining etf.com, he wrote for numerous investment websites, including Seeking Alpha and Kiplinger. 

 

Kent holds a Master of Business Administration (MBA) degree and is a practicing Certified Financial Planner (CFP®) with 25 years of experience managing investments, guiding clients through some of the worst economic and market environments in U.S. history. He has also served as an adjunct professor, teaching classes for The College of Charleston and Trident Technical College on the topics of retirement planning, business finance, and entrepreneurship. 

 

Kent founded a registered investment advisory firm in 2006 and is based in Hilton Head Island, SC, where he lives with his wife and two sons. Outside of work, Kent enjoys spending time with his family, playing guitar, and working on his philosophy book, which he plans to publish in the coming year.