Element Funds Brings Experience Managing $13 Billion in Private Equity Natural Resources Investments to Pure-Play ETF Debut
- Private Equity
- December 29, 2022
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– New firm brings decades of private equity experience in metals investing to the ETF market for Electric Vehicle and Battery Energy Storage System Critical Inputs –
NEW YORK, Dec. 29, 2022 /PRNewswire/ — Element Funds, a new investment firm founded to provide investors institutional quality access to the critical metal inputs at the core of the renewable economy, today announced the launch of its inaugural Element EV, Solar & Battery Materials (Lithium, Nickel, Copper, Cobalt) Futures Strategy ETF (NYSE: CHRG).
Element will leverage the experience of John Raymond and John Calvert, principals at the natural resources-focused private equity firm, The Energy & Minerals Group (“EMG”), in managing CHRG. The ETF will provide actively managed exposure to the core commodities essential to the production of electric vehicles (“EV”), battery energy storage systems (“BESS”) and other renewable infrastructure.
Through 2030, an estimated $1.2 trillion is expected to be spent to both develop and produce electric vehicles alone, from mining and refining the raw materials, to manufacturing the batteries, according to Reuters. To address the lopsided supply-demand balance of this massive energy expansion, over the next decade the global economy is projected to require more than 200 new mines and plants to supply the necessary raw materials.
CHRG will provide investors of all classes with institutional-quality exposure to the futures contracts of commodities – such as lithium, cobalt, nickel, and copper – key to the shift to a net-zero carbon renewable economy.
By directly accessing the futures of the key elements crucial to EV and BESS technology, CHRG will not be beholden to stock price fluctuations based factors unrelated to the demand of the underlying metals. Therefore, investors will not be hampered by company specific factors such as political, permitting, construction, operations, balance sheet and management risks. Furthermore, unlike other products in the space, the CHRG ETF will be actively managed to navigate the ever-evolving nature of technology in the renewable energy sector.
“Over the past several years, we’ve seen enormous investor demand in strategies linked to the EV and renewables revolution,” said Will McDonough, CEO of Element Funds. “However, critical metals are not an investment that you can set and forget. We will utilize our global experience to continuously monitor and re-evaluate CHRG’s portfolio allocations and weighting based on real-time industry developments.”
“In the decades of experience that we have accumulated managing private market strategies in this space, we have become acutely aware of the necessity of an active approach to investing in the raw materials at the foundation of the renewable energy economy,” said John Raymond, CEO of EMG. “Our experience confirms that accessing these specific metals requires a deep knowledge in the exploration, mining, processing, and end-use application lifecycle, and we’re excited to bring investors a means of accessing this market.”
Element Funds is founded by Will McDonough, John Raymond, and John Calvert. Mr. McDonough is a career investor whose career in finance included management of $17 billion of private capital for Goldman Sachs’ current and former partners. Mr. Calvert and Raymond bring experience currently managing $13 billion of private equity capital in the natural resources sector.
At launch, CHRG will reflect industry demand for the key metals, and will invest in financial instruments linked to lithium, nickel, copper, and cobalt.
About Element Funds
Element Funds is an asset manager with more than 70 years combined experience investing in natural resources. We combine proprietary methodologies with extensive domain experience to offer investors actively managed direct and efficient exposures to growth and diversification.
Frank Taylor/Christian Healy
Investors should carefully consider the investment objectives, risks, charges and expenses of the Element EV & Solar Battery Materials (Lithium, Nickel, Copper, Cobalt) Futures ETF. This and other important information about the Fund is contained in the Prospectus, which can be obtained by calling 1-800-617-004 or visiting www.elementfunds.com. The Prospectus should be read carefully before investing.
Investing in ETF’s involves risk, including possible loss of principal. International investing may be subject to special risks, including currency exchange rate volatility, political, social or economic instability, less publicly available information, less stringent investor protections, and differences in taxation, auditing and other financial practices. Investment in emerging market securities involves greater risk than that associated with investment in foreign securities of developed foreign countries. The Fund invests in securities of companies of all sizes, including those that have relatively small market capitalizations. Investments in securities of these companies involve greater risks than do investments in larger, more established companies. Derivatives include instruments and contracts that are based on, and are valued in relation to, one or more underlying securities, financial benchmarks or indices, such as futures, options, swap agreements and forward contracts. The Adviser may engage in speculative transactions which involve substantial risk and leverage, such as making short sales. The use of leverage by the Adviser may increase the volatility of the Fund. Because the Fund invests in financial instruments that are linked to different types of commodities from the metals sector, the Fund is subject to the risks inherent in the metals sector. Such risks may include, but are not limited to: general economic conditions or cyclical market patterns that could negatively affect supply and demand in a particular industry; changes in environmental conditions, energy conservation and environmental policies; competition for or depletion of resources; adverse labor relations; political or world events; increased regulatory burdens; changes in exchange rates; imposition of import controls; obsolescence of technologies; and increased competition or new product introductions. The exploration and development of mineral deposits involve significant financial risks over a significant period of time, which even a combination of careful evaluation, experience and knowledge may not eliminate. Few properties which are explored are ultimately developed into producing mines. The Fund invests in companies that are economically tied to the lithium industry, which may be susceptible to fluctuations in the underlying commodities market. Commodity prices may be influenced or characterized by unpredictable factors, including, where applicable, high volatility, changes in supply and demand relationships, weather, agriculture, trade, changes in interest rates and monetary and other governmental policies, action and inaction. Securities of companies held by the Fund that are dependent on a single commodity, or are concentrated on a single commodity sector, may typically exhibit even higher volatility attributable to commodity prices.
Shares are bought and sold at market price (not NAV) and are not individually redeemed from the Fund. The returns shown do not represent the returns you would receive if you traded shares at other times. Brokerage commissions will reduce returns. The market price returns are based on the official closing price of an ETF share or, if the official closing price is not available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. NAVs are calculated using prices as of 4:00 PM Eastern Time.
The Element EV & Solar Battery Materials (Lithium, Nickel, Copper, Cobalt) Futures ETF is distributed by Quasar Distributors, LLC.
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SOURCE Element ETFs LLC