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How to Invest in Copper ETFs [2024] | Step-by-Step

how to invest in copper etf
Nemanja Curcic

Summary: Copper is becoming an increasingly attractive investment opportunity due to limited supply and growing demand in the electronic parts, construction, and renewable energy sectors. One of the most straightforward answers on how to invest in this commodity is through copper ETFs, using the services of our preferred online brokerage, Interactive Brokers.

Best Platform for Worldwide Stock Trading & Investing

  • Highly trusted multi-asset broker with clients in over 200 countries

  • Trade on 150 markets globally from a single platform (stocks, ETFs, futures, currencies, crypto & more)

  • Low commissions starting at $0 with no platform fees or account minimums

  • Easily fund your account and trade assets in 26 currencies

  • IBKR pays up to 4.58% interest on cash balances of $10k or more

Up to 4.58% interest on balance*

What are copper ETFs?

Copper is a valuable metal and commodity with an indispensable role across several industries. As the most conductive non-precious metal, it is vital for electrical wires and integrated circuits. Furthermore, copper usage is five times higher in renewable energy than in fossil fuel power generation, making copper the preferred commodity for renewable energy like solar, wind, hydro, and biofuel.

Buying and selling copper physically is difficult and inconvenient due to the required effort and necessary logistics. However, financial instruments like copper exchange-traded funds (ETFs) allow investors to embark on the copper market without dealing with storage, transportation, or security concerns. 

Best copper ETFs for 2024

Our selection of top copper ETF picks include:

  • United States Copper Index ETF (NYSE Arca: CPER);
  • Global X Copper Miners ETF (NYSE Arca: COPX).

Best Platform for Worldwide Stock Trading & Investing

  • Highly trusted multi-asset broker with clients in over 200 countries

  • Trade on 150 markets globally from a single platform (stocks, ETFs, futures, currencies, crypto & more)

  • Low commissions starting at $0 with no platform fees or account minimums

  • Easily fund your account and trade assets in 26 currencies

  • IBKR pays up to 4.58% interest on cash balances of $10k or more

Up to 4.58% interest on balance*

If you are looking for more ways to invest in copper, check our “How to Invest in Copper” guide.


1. United States Copper Index ETF (CPER)

United States Copper Index ETF (NYSE Arca: CPER) is an ETF that enables investing in copper via futures contracts. The index is structured as a commodity pool and tracks the price movement of copper, acting as a single entity to increase leverage and profits. Its holdings include copper futures contracts and the equivalent amount of cash as collateral.

United States Copper Index ETF price today


2. Global X Copper Miners ETF (COPX)

Global X Copper Miners ETF (NYSE Arca: COPX) is an equity-based ETF that gives investors access to a wide range of companies in the copper mining industry. It aims to secure investment outcomes that closely follow the price and yield performance of the Solactive Global Copper Miners Total Return Index.

Some of the copper stocks this ETF observes include:

  • Zijin Mining;
  • Antofagasta;
  • Southern Copper;
  • Grupo Mexico;
  • Freeport-McMoRan.

Global X Copper Miners ETF price today


How to invest in copper ETFs: Step-by-step

If you wonder how to invest in copper ETFs, just follow our step-by-step guide for a quick and simple explanation.

Step 1: Choose a broker

To invest in copper ETFs, you first need to gain access to the corresponding market, which you can do by using a third-party investing service. The simplest and most effective option is an online brokerage.

To securely invest in copper ETFs, we recommend you consider Interactive Brokers (IBKR):

  • Commission-free stock trading;
  • Global stock-trading on 90+ market centers;
  • Fractional shares available;
  • Extra income on fully paid shares;
  • Lowest financing rates for margin accounts in the industry;
  • No account minimum.

Best Platform for Worldwide Stock Trading & Investing

  • Highly trusted multi-asset broker with clients in over 200 countries

  • Trade on 150 markets globally from a single platform (stocks, ETFs, futures, currencies, crypto & more)

  • Low commissions starting at $0 with no platform fees or account minimums

  • Easily fund your account and trade assets in 26 currencies

  • IBKR pays up to 4.58% interest on cash balances of $10k or more

Up to 4.58% interest on balance*

Step 2: Open and fund your account

After you decide on a brokerage, you should proceed to create and verify your account. Soon after you register, the investing platform will email you the precise instructions.

Once you complete account verification, you prepare to invest in copper ETFs by transferring money into your account. Commonly available funding methods include bank transfers, debit or credit cards, and transaction services like PayPal.

Step 3: Decide how much you want to invest

Outlining your budget before you invest in copper ETFs is vital to success. Keeping safely within the budget limits should prevent your potential financial collapse. To allow for a stable and safe investment, make sure you have done the following:

  • Paid off all high-interest debt, such as credit cards and personal loans;
  • Created an emergency fund that covers at least three months of daily life expenses.

Step 4: Place your order and trade copper ETFs

The next step is placing an order and conducting the trade. Go through the following: 

  • Step 1: Log into your account and find the desired copper ETF ticker;
  • Step 2: Type in the amount you wish to purchase;
  • Step 3: Select the order type (market order or limit order) and place it;
  • Step 4: Confirm the trade order.

Pros and cons of investing in copper ETFs

Pros

Pros

  • Diversification: Copper ETFs expose investors to the appreciation of the copper market without the need to physically possess copper. This type of investment is particularly suitable for diversification;
  • Liquidity: ETFs are commonly traded on stock exchanges, offering investors liquidity as they can buy and sell shares throughout the trading day at market prices;
  • Global economic indicator: The value of copper is considered to be a good indicator of economic activity due to its widespread use in various industries. Investing in copper ETFs can offer a way to capitalize on global economic trends;
  • Cost-efficiency: ETFs frequently have lower expense ratios than actively managed funds, making them cost-effective investments.
Cons

Cons

  • Volatility: Copper prices are prone to volatility induced by factors such as economic conditions, geopolitical events, and supply-demand fluctuations. This instability can result in shifts in the value of copper ETFs;
  • Market and industry risks: Copper-related companies, which copper ETFs track, are vulnerable to risks such as operational challenges, regulatory changes, and geopolitical issues. Unsuitable market and industry conditions can impact the fund’s performance;
  • Commodity risk: The value of copper ETF shinges on the price movements of copper. If copper prices decline, the value of the ETF will almost certainly follow suit.

Consider investing in more ETFs

If you are considering additional investing in ETF commodities, you can check out our other guides on this topic, including:

Common mistakes to avoid when investing in copper ETFs

Make sure to avoid these common investing mistakes:

  • Lack of research: Research the target ETF and the related commodities in detail before investing;
  • Lack of strategy: Set your goals before you spend any money;
  • Staking everything on one asset: Always diversify your portfolio;
  • Falling prey to scams: Avoid illegal platforms and suspicious deals.

Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.

FAQs about how to invest in copper ETFs

Can I buy physical copper instead of investing in ETFs?

Yes, you can trade physical copper, but it comes with challenges like storage, transport, and security. Therefore, ETFs provide a convenient alternative.

What are the best copper ETFs?

Our choice of the top copper ETFs are United States Copper Index ETF (NYSE Arca: CPER) and Global X Copper Miners ETF (NYSE Arca: COPX).

How to trade copper ETFs?

To trade copper ETFs, register an account with a reputable investing service like Interactive Brokers, designate a copper ETF, fund your account, and place a buy or sell order through the platform.

Do copper ETFs pay dividends?

Unfortunately, most copper ETFs do not pay dividends.

Is trading copper ETFs safe?

By doing your own research, making sound investing decisions, and using a regulated brokerage like Interactive Brokers, you maximize the safety and success chance of your investment.

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