The Global Palladium Fund (GPF), established by MMC Norilsk Nickel, the world’s largest producer of palladium and high-grade nickel and a major producer of platinum and copper, has listed the world’s only physically-backed copper and nickel ETCs on Xetra.
The firm writes that they are competitively priced with an annual total all-in cost of 0.85 per cent and 0.75 per cent respectively, making them the most cost-effective way for European-based investors to achieve exposure to the metals through an exchange traded product, as they seek to take advantage of the energy transition megatrend. Copper and nickel are two of the minerals that will feature prominently in the transition to clean energy as highlighted by the International Energy Agency in their recent report, The Role of Critical Minerals in Clean Energy Transitions, the firm says.
Targeting family offices, wealth managers, institutional and other similar professional investors, the new physically-backed copper and nickel ETCs will track the spot price of the metals. The metal backing GPF ETCs is stored in secure warehouses in Rotterdam. All six of GPF’s physically-backed, low-cost metal ETCs, which also include gold, silver, platinum and palladium, are now listed on Xetra. The ETCs are also available on LSE, SIX and Borsa Italiana. Flow Traders has been appointed as market maker and will provide liquidity in these funds on the different exchanges.
GPF writes that it is the first ETC issuer to use Blockchain technology to provide investors with enhanced transparency and security in their metal ETCs by recording bar information into distributed ledger technology.
As outlined in the issuing prospectus, the copper and nickel backing the ETCs is sourced from MMC Norilsk Nickel and other producers and metal suppliers which have confirmed their compliance with the Sustainable Development Goals of the UN 2030 Agenda and other global initiatives in sustainable development and responsible mining. GPF is the only major ETC issuer to make such a pledge.
To strengthen ETC investor security, GPF uses IBM’s Hyperledger Blockchain in the custody chain of the metal. This is in addition to the traditional processes used by the custodian, enhancing the transparency and accountability of the issuer. By recording bar and cathode information on the blockchain, it provides clear ownership and an immutable custody chain for investors using the ETCs.
Alexander Stoyanov, Chief Executive Officer of GPF says: “Listing our physical copper and nickel ETCs in Germany is another important milestone in the democratisation of metal investing, enabling investors low-cost access to two metals which will have a fundamental role in the transition to clean energy. They also benefit from enhanced transparency and security and sustainable supply source, thanks to our innovative use of blockchain technology and our commitment to sustainable development and responsible mining.”