Nickel ETF investors enjoy the spoils of turmoil

Nickel Futures ease as traders liquidate

Nickel futures plunged by 8% on Thursday after participants rushed to liquidate their long positions. A day ago, the London Metal Exchange (LME) paused nickel trading on its electronic system within a minute of opening due to a technical issue and after falling by the 5% maximum allowed. Later, the LME raised the trading limit to 8%, but still much lower than the 15% for other metals.

Russia, which accounts for 10% of the global supply, is now the most sanctioned country on the planet after invading Ukraine. The developments sent jitters in the Nickel market which saw prices briefly reaching the $100,000 mark. The short squeeze led the LME to pause Nickel trading from March 8th until March 16th.

Nickel was already rallying before Russia’s invasion of Ukraine as robust demand from the stainless steel and battery industry drained inventories.

For American investors: How to invest in Nickel Futures?

Nickel ETFs have been a trending keyword among retail investors over the past week. However, there are no pure Nickel ETFs available for trade in North America. As an alternative, investors can seek ETFs with exposure to partial exposure such as the Aberdeen Bloomberg Industrial Metals Strategy K-1 Free ETF (BCIM). BCIM seeks to track the Bloomberg Industrial Metals Subindex and invests in copper, aluminium, zinc and nickel futures. BCIM has a total expense ratio of 0.47% and trades primarily on the NYSE.

For European investors: How to invest in Nickel Futures?

European investors can have access to Nickel futures through the WisdomTree Nickel (NICK). NICK seeks to track the Bloomberg Nickel Subindex and provides exposure to Nickel Futures. The fund has a total expense ratio of 0.49% and trades on multiple European exchanges, including the London Stock Exchange (NICK, USD), the Borsa Italiana (NICK, EUR), and the Deutsche Boerse (NICK, EUR).

NICK has generated a return of +29% this year and a staggering +60% y-o-y.

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