On March 22, 2023, Sprott Asset Management announced the launch of Sprott Nickel Miners ETF (Nasdaq: NIKL). This exchange traded fund (ETF) joins the five others in the Sprott Energy Transition Suite: Sprott Energy Transition Materials ETF (Nasdaq: SETM), Sprott Lithium Miners ETF (Nasdaq: LITP), Sprott Uranium Miners ETF (Nasdaq: URNM), Sprott Junior Uranium Miners ETF (Nasdaq: URNJ) and Sprott Junior Copper Miners ETF (Nasdaq: COPJ).
Please Note: This FAQ is not wholly inclusive of all relevant information. Investors should consult the prospectus for more information, or please reach out to your Sprott representative at 888.622.1813 or firstname.lastname@example.org for answers to additional questions.
The Sprott Nickel Miners ETF is listed on Nasdaq® under the symbol “NIKL.” Investors can purchase NIKL in a brokerage account or by contacting their financial advisor.
The Sprott Nickel Miners ETF (NIKL) seeks to provide investment results that, before fees and expenses, correspond generally to the total return performance of the Nasdaq Sprott Nickel Miners™ Index.
The Nasdaq Sprott Nickel Miners™ Index is designed to track the performance of a selection of global securities in the nickel industry. The Fund will, under normal circumstances, invest at least 80% of its total assets in securities of this Index.
The energy transition is a significant global structural change intended to decrease our dependence on fossil fuels in favor of low-carbon and renewable energy. While we believe fossil fuels will likely continue to play a role in our future, substantial global investment and government mandates in favor of low-carbon and renewable energy are driving opportunities in the energy transition industry.
The index combines Sprott’s decades of experience in the mining sector with Nasdaq’s renowned index expertise. To be eligible for inclusion in the Nasdaq Sprott Nickel Miners™ Index (NSNIKL™), a company must meet the requirements that follow.
Constituent Weighting Process
Investors who seek pure-play2 access to nickel through companies that are upstream in the supply chain may want to consider investing in NIKL. Nickel miners may be well positioned to benefit from increased investment in the low-carbon and renewable energy sector.
Sprott Asset Management LP is the investment adviser to the Sprott Nickel Miners ETF. ALPS Advisors, Inc. is the sub-adviser, and ALPS Fund Services, Inc. serves as the administrator. ALPS Distributors, Inc. is the Distributor for the Sprott Nickel Miners ETF and is a registered broker-dealer and FINRA Member. Additionally, State Street Bank and Trust Company serves as the custodian and transfer agent.
Increased investment is driving growth in the critical minerals necessary for the energy transition
Nickel is a vital component in the lithium-ion batteries used in the growing hybrid and electric vehicle (EV) markets
Nickel is becoming an increasingly important part of lithium-ion batteries, and demand for this critical mineral is expected to increase significantly
The Sprott Nickel Miners ETF is the only ETF to provide pure-play exposure to the nickel mining equities essential to the electric vehicle revolution
Clean energy is energy that has zero carbon emissions and comes from renewable and nuclear energy sources. Currently, nations around the world have committed to the Paris Agreement, which is a legally binding international treaty on climate change. It was adopted by 196 Parties at COP21, the United Nations Climate Change Conference, in Paris in December 2015. Its goal is to limit global warming to well below 2.0 degrees Celsius, preferably to 1.5 degrees Celsius, compared to pre-industrial levels. To reach the goal of net-zero by 2050, emissions need to be reduced by 45% by 2030.10
Critical minerals are natural materials that are essential to the generation, transmission and storage of clean energy. Sprott focuses on nickel as a major battery metal that is crucial to energy storage and the batteries powering the electric vehicle revolution.
We believe the Sprott Nickel Miners ETF has broad appeal to many investors. The following general themes are driving investor interest.
The Sprott Nickel Miners ETF expects to declare and distribute all its net investment income, if any, to shareholders as dividends at least annually and on a pro-rata basis. The Fund may distribute such income dividends and capital gain more frequently, if necessary, to reduce or eliminate federal excise or income taxes on the Fund.
Please reach out to your Sprott representative at 888.622.1813 or email@example.com for answers to additional questions.
1 The intensity score for stocks with revenue and for which revenue is deemed to be an appropriate characteristic is the percentage of their revenue attributable to the aforementioned strategy of the Index.
2 The term “pure-play” relates directly to the exposure that the fund has to the total universe of investable, publicly listed securities in the investment strategy.
3 Source: Energy Transition Investment Trends 2023, BloombergNEF
4 Source: “U.S. Crosses the Electric-Car Tipping Point for Mass Adoption,” Bloomberg, July 9, 2022
5 Source: Reuters, December 8, 2021
6 Source: “Which Brands Are Going Fully Electric and by When?” CarExpert, August 14, 2021
7 Source: “The Role of Critical Minerals in Clean Energy Transitions,” International Energy Agency (IEA), May 2021
8 Source: https://nickelinstitute.org/en/about-nickel-and-its-applications/nickel-in-batteries/
9 Source: https://www.dallasfed.org/research/economics/2022/1011
10 United Nations Climate Change at https://unfccc.int/process-and-meetings/the-paris-agreement/the-paris-agreement.
An investor should consider the investment objectives, risks, charges, and expenses carefully before investing. To obtain a Sprott Nickel Miners ETF Statutory Prospectus, which contains this and other information, visit https://sprottetfs.com/nikl/prospectus, contact your financial professional or call 888.622.1813. Read the Prospectus carefully before investing.
The Fund is not suitable for all investors. Investors in the Fund should be willing to accept a high degree of volatility in the price of the Fund's shares and the possibility of significant losses. An investment in the Fund involves a substantial degree of risk. The Fund is considered non-diversified and can invest a greater portion of assets in securities of individual issuers than a diversified fund. As a result, changes in the market value of a single investment could cause greater fluctuations in share price than would occur in a diversified fund.
Shares are not individually redeemable. Investors buy and sell shares of the Sprott Nickel Miners ETF on a secondary market. Only market makers or "authorized participants" may trade directly with the Fund, typically in blocks of 10,000 shares.
Funds that emphasize investments in small/mid-cap companies will generally experience greater price volatility. Diversification does not eliminate the risk of investment losses. ETFs are considered to have continuous liquidity because they allow an individual to trade throughout the day. A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses, affect the Fund’s performance.
The Sprott Nickel Miners ETF seeks to provide investment results that, before fees and expenses, generally correspond to the total return performance of the Nasdaq Sprott Nickel Miners™ Index (NSNIKL™).
Nasdaq®, Nasdaq Nickel Miners™ Index, and NSNIKL™ are registered trademarks of Nasdaq, Inc. (which with its affiliates is referred to as the “Corporations”) and are licensed for use by Sprott Asset Management LP. The Product(s) have not been passed on by the Corporations as to their legality or suitability. The Product(s) are not issued, endorsed, sold, or promoted by the Corporations. THE CORPORATIONS MAKE NO WARRANTIES AND BEAR NO LIABILITY WITH RESPECT TO THE PRODUCT(S).
Sprott Asset Management LP is the investment advisor to the Sprott Nickel Miners ETF. ALPS Distributors, Inc. is the Distributor for the Sprott Nickel Miners ETF and is a registered broker-dealer and FINRA Member.
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