Nuclear renaissance

Our interview this week is with John Ciampaglia, CEO, Sprott Asset Management and Senior Managing Partner, Sprott Inc, a firm that specialises in investment in precious metals and energy transition investment strategies and also manages the Sprott Uranium Miners UCITS ETF (URNM), from HANetf, which recently saw assets under management go over USD100 million on the back of renewed interest in the element. The US version of the fund has some USD1.25 billion under management.

Uranium is core to the production of nuclear energy which is back in fashion as a ‘clean’ energy with low carbon footprint. The change in attitude started two years ago at COP26 when there was the first public acknowledgement from the world’s governments that they couldn’t hit their targets if they phased out nuclear energy, Ciampaglia says.

"Then came the shock of the invasion of Ukraine which created an energy crisis for countries that are not resource independent, and the second real catalyst has been a realisation that nuclear energy has to be part of the mix as it provides incredible energy security."

The World Nuclear Association’s long-term forecast for uranium demand has gone up 15 per cent since its last forecast two years ago.

Other news this week came from Cerulli Associates in the US who write that, for the first time, ETFs are viewed by asset managers as the largest opportunity among investment vehicles, taking a lead over institutional separate accounts, which had been viewed as the largest opportunity.

"Most product development in ETFs is occurring in the transparent active wrapper, which appears to have won the battle over semi-transparent structures. However, opinions still stand that low-liquidity strategies such as small-cap equity will need to use semi-transparent structures to effectively reallocate throughout the year. Strategy replications across vehicle structures lead product development plans when compared to building out new strategies for several vehicles, including ETFs, separate accounts, and collective investment trusts (CITs)," Cerulli reports.

Beverly Chandler, Managing Editor

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